contribution/machine hour?

First of all work out contribution. (SP-VC).

if work out for the total production
then: total contribution divide by total machine hours

If worked out per unit

the contribution per unit divide by Machine hours.

However, becareful here. If machine hours is only 20 minutes ie 1/3 an hour the you need to multipy by 3 to work our contribution per hour

eg. contribution per unit is £6

machine hours taken is 20 minutes
therefore £6 divide by 20 times 60 to work out a machine hour contribution = £18






or if machine hours taken is 90 minutes, then you need to divide the resuly by 3 and multiply by 2 to work out contribution per hour.

eg contrubution per unit is £6

machine hours taken - 1.5 hrs (90 minutes)
therefore £6 divide by 90 times 60 = £4 per machine hour

hope this helps

coojee wrote: »

A useful tip, when you see the word "per" just substitute the words "divided by". So "contribution per machine hour" translates to "contribution divided by machine hours".

And if in the question it says machine hours/unit, "/" also just means divide, so it becomes really straight forward!:D