Explorer Company manufactures two products, hard-tops and covers for its convertible vehicles. Data for each follows: Hard-top

Question:

Explorer Company manufactures two products, hard-tops and covers for its convertible vehicles. Data for each follows:
Hard-top Covers
Direct labor hours required per unit 4 8
per unit $240 $390
Only 4,200 direct labor hours are available per month. How many units of each product should Explorer make in order to maximize profits?
Hard-tops............Covers
a. 4,200...................400
b. 1,050......................0
c. 1,050...................250
d. 0........................250
Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...