1. Fast $, Inc produces silver and gold pendants. The data are as follows:

Silver Gold

Price	$30	$125
Material	8	35
Labor	5	73
Contribution Margin
Labor Hours Required	$0 .75	$1.00
Demand	100	75

Fixed Costs = $10,000; Labor hours available = 100

Are there enough labor hours to satisfy demand for both types?_____

1. Determine the contribution margin per labor hours for each

2. How many silver pendants and how many gold pendants would maximize profits? Prove your answer.

2. Given the following data, prove and explain whether the Red line of jewelry should be discontinued.

Sales $200,000

Variable Costs 125,000

Avoidable Fixed Costs $80,000

Unavoidable Fixed Costs $10,000