1. (20 points). Yamaha Inc. makes and sells three models of jet boats: Fishing, Wake and Luxury. Relevant annual production and sales information, on a per unit basis, is provided in the following table: + Per Unit Financial Information Selling price Production Costs: Fishing Wake Luxury $30,000 $50,000 $70,000 Direct materials $10,300 $16,000 $25,000 Direct Labor ($20 per hour) $2,000 $3,000 $6,000 Variable Overhead $1,500 $2,250 $4,500 Fixed Overhead, allocation per unit $6,000 $16,000 $16,000 SG&A Costs: Variable SG&A Fixed SG&A, allocation per unit $1,200 $1,550 $1,800 $1,000 $1,000 $1,000 Variable overhead is applied based on DLH's. Fixed overhead is applied based on machine hours, at a rate of $100 per MH. Explain and support your answers. Assume now that Yamaha faces the following annual demand for each model, and that skill labor is unlimited but machine hours capacity is limited at 36,000 MHs per year. Fishing Wake Luxury - Demand quantity 400 150 200 Caterpillar offered Yamaha an annual upgrade service. The upgrade would double the annual MH capacity to 72,000 MHs. What is the maximum amount that Yamaha would be willing to pay for the annual upgrade service