Question

Dalton Inc. produces and sells three products. Unit data concerning each product is shown below.

		Product
		D		E		F
Selling price		$181.00		$283.20		$233.00
Direct labor costs		28.60		83.60		34.10
Other variable costs		90.00		78.00		140.00

The company has 1,900 hours of labor available to build inventory in anticipation of the company’s peak season. Management is trying to decide which product should be produced. The direct labor hourly rate is $11.

Product	Direct Labor Cost Per unit	Direct Labor Hours Per unit
a	b	c=b/$11
Peoduct D	$                                      28.60	2.60	hours per unit
Peoduct E	$                                      83.60	7.60	hours per unit
Peoduct F	$                                      34.10	3.10	hours per unit

Determine the contribution margin per direct labor hour. (Round intermediate calculation and final answers to 2 decimal places, e.g. 52.75.)

		Product D		Product E		Product F
Contribution margin per direct labor hour		$		$		$

Answer 1

Product	Selling price per unit	Direct Labor Cost Per unit	Other variable cost	Contribution margin per unit	Direct Labor Hours per unit	Contribution margin per labor hour
a	b	c	d	e=b-c-d	f	fg=f/e
Peoduct D	181	$                                         28.60	90	$                                              62.40	2.6	$                                                           24.00
Peoduct E	283.2	$                                         83.60	78	$                                           121.60	7.6	$                                                           16.00
Peoduct F	233	$                                         34.10	140	$                                              58.90	3.1	$                                                           19.00

Summery
	Product D	Product E	Product F
Contribution margin per direct labor hour	$                                            24	$                                               16	$                                    19