2C2M MILTON MANUFACTURING OCCASIONALLY HAS CAPACITY PROBLEMS IN ITS M...

258.

CSO: 2C2g

LOS: 2C2m

Milton Manufacturing occasionally has capacity problems in its metal shaping division,

where the chief cost driver is machine hours. In evaluating the attractiveness of its

individual products for decision-making purposes, which measurement tool should the

firm select?

If machine hours do not

If machine hours

constrain the number

constrain the number

of units to be produced

of units to be produced

a.

Contribution margin

Contribution margin per machine hour.

b.

Gross profit

Contribution margin.

c.

Contribution margin

Contribution margin ratio.

d.

Contribution margin per

Contribution margin.

machine hour