Question
Edgecomb Pottery makes plates, bowls, and platters using glazes that develop starburst patterns when the pottery is fired. The art of creating this pottery, which
Edgecomb Pottery makes plates, bowls, and platters using glazes that develop starburst patterns when the pottery is fired. The art of creating this pottery, which includes throwing, bisquing, and glazing, is a craft that takes years of experience to master. The demand for the companys pottery far exceeds the companys studio capacity. Information concerning three of the companys products follows:
Plates | Bowls | Platters | |||||||
Selling price per unit | $ | 34.00 | $ | 83.20 | $ | 118.00 | |||
Variable cost per unit | 8.80 | 11.80 | 28.00 | ||||||
Studio time required to produce one unit | 1 | hours | 3 | hours | 4 | hours |
More time could be made available by asking employees in the studio to work overtime. Assuming that this extra time would be used to produce bowls, the maximum amount that the company should be willing to pay per hour to keep the studio open after normal working hours is: (Round your answer to two decimal places.) |
$25.80.
$71.40.
$6.80.
$23.80.
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