1 Grant Company owns four machines that provide 16,950 machine hours per year. Part X requires 1.5 hours, and Part Y requires 0.5 hours. The respective unit contribution margins for Part X and Y are $63 and $30. If a maximum of 22,800 units of each part can be sold, what is optimal mix of parts? N 3 O a. Part X: 3,700 units; Part Y: 22,800 units O b. Part X: 3,700 units; Part Y: 14,325 units O c. Part X: 22,800 units; Part Y: 22,800 units O d. Part X: 8,475 units; Part Y: 22,800 units 4 5 5 6 7 8 9 10 PRE-TEST Problem #4 of 11 ? If a company has a policy of charging its customers 15% above direct materials and labor costs. The costs incurred are as follows: 1 2 Direct materials Direct labor $58,000 4,000 3 What is the price charged by the company? 4 5 O a. $71,300 O b. $72,500 O c. $75,500 O d. $62,000 6 7 8 00 9 Adams Company makes 130,000 units per year of a part used in its ice cream machine. An outside supplier offered to sell it to Adams for $97.00. Currently, Adams has the following costs to manufacture It: ? 2 $35.10 3 38.00 Direct materials Direct labor Variable overhead Fixed overhead Total costs 2.00 4 33.70 $108.80 5 6 If the offer is accepted, all direct labor cost would be avoided. However, $15.90 of fixed overhead will continue even if the part is purchased from outside. How much of the unit product cost of $108.80 is relevant for decision making? 7 8 O a. $92.90 O b. $57.89 O c. $75.10 O d. $108.80 9 10 11