Answer:
Note: The full question is attached as picture below
Acoustic Electric Total
(a) Hours dedicated to each product 262 90
Units produced for most profitable mix 131 30
(b) Contribution Margin per unit $130 $180
Total Contribution Margin - two shifts $17,030 $5,400 $22,430
Total Contribution Margin - one shift $11,440
Incremental Revenue $10,990
Incremental Expense $9,000
Total Incremental Income $1,990
Conclusion: Yes, the company should add another shift
Acoustic Electric Total
Sales Price $225 $300
Variable Cost $95 $120
Contribution Margin per unit $130 $180
Machine hours per unit 2 3
Contribution Margin per machine hour $65 $60
Maximum Demand 131 65
Hours Required 262 195
Hours Used 176
Contribution Margin (One Shift) $11,440 - $11,440
