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Healthy Hound, Incorporated, makes two lines of dog food: ( 1 ) Basic Chunks and ( 2 ) Custom Cuts. The Basic Chunks line is
Healthy Hound, Incorporated, makes two lines of dog food: Basic Chunks and Custom Cuts. The Basic Chunks line is a dry food that is processed almost entirely by an automated process. Custom Cuts is a canned food made with real horsemeat. The slabs of meat are cut and trimmed by hand before being shoveled into an automated canning machine. Basic Chunks sells very well and is priced significantly below competitive brands. Sales of Custom Cuts have been on the decline, as the company has failed to keep the brand price competitive. Other information concerning each product line is provided as follows:
tableBasic Chunks,Custom CutsNumber of units produced and sold per month,Direct materials cost per unit,$$
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