Daisy Bath Products, Inc. (DBP) makes a variety of ceramic sinks and tubs. DBP has just developed a line of sinks and tubs made from a mixture of glass and ceramic. The sinks sell for $200 each and have variable costs of $70. The tubs sell for $700 and have variable costs of $320. The glass and ceramic sinks and tubs require the use of specialized molding equipment. The specialized molding equipment has 5,000 hours of capacity per year. A sink uses an average of 5 hours of specialized molding equipment time; a tub uses an average of 6 hours of specialized molding equipment time.
What is the contribution margin per hour of specialized molding equipment time for sinks? a.
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