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Lakeside Inc. is considering whether to enter the market to produce and sell Product X. The market selling price for Product X is well established
Lakeside Inc. is considering whether to enter the market to produce and sell Product X. The market selling price for Product X is well established at $460 per unit, and Lakeside requires a profit margin of 30% on product lines. Required: Calculate the target cost per unit Lakeside must achieve to produce Product X. Target cost per unit Lakeside Inc. produces Product A and Product B that require special machining time. Machine time capacity is 15,740 machine hours per month. Lakeside estimates April demand for each product and provides additional information as follows: Product A 4,400 units $ 726 per unit 3 per unit Product B 3,400 units $ 640 per unit 2 per unit April demand Contribution margin Required machine hours Required: Determine how many units of each product Lakeside should produce to maximize contribution margin in April. Product A Product B Product mix for April production units units
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