Lovejoy's Cake Shop makes three types of cakes: White, Chocolate, and Swirl on one assembly line that has a limit of 400 labour-hours per week. Lovejoy can sell all the cakes it can make under current operating capacity. Manufacturing information per cake for each product is as follows:

Required:
Determine the total weekly contribution margin when all labour-hours are allotted to the product with the highest:
a. Unit selling price.
b. Unit contribution margin.
c. Contribution per labour-hour.

Question

Lovejoy's Cake Shop makes three types of cakes: White, Chocolate, and Swirl on one assembly line that has a limit of 400 labour-hours per week. Lovejoy can sell all the cakes it can make under current operating capacity. Manufacturing information per cake for each product is as follows:
  
Required:
Determine the total weekly contribution margin when all labour-hours are allotted to the product with the highest:
a. Unit selling price.
b. Unit contribution margin.
c. Contribution per labour-hour.

Quizplus · Accepted Answer

The Answer of Lovejoy's Cake Shop makes three types of cakes: White, Chocolate, and Swirl on one assembly line that has a limit of 400 labour-hours per week. Lovejoy can sell all the cakes it can make under current operating capacity. Manufacturing information per cake for each product is as follows:
  
Required:
Determine the total weekly contribution margin when all labour-hours are allotted to the product with the highest:
a. Unit selling price.
b. Unit contribution margin.
c. Contribution per labour-hour.

Lovejoy's Cake Shop Makes Three Types of Cakes: White, Chocolate