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McNulty, Inc., produces desks and chairs. A new CFO has just been hired and announces a new policy that if a product cannot earn a
McNulty, Inc., produces desks and chairs. A new CFO has just been hired and announces a new policy that if a product cannot earn a margin of at least 15 percent, it will be dropped. The margin is computed as product gross stion profit divided by reported product cost Manufacturing overhead for year 1 totaled $910,000. Overhead is allocated to products based on direct labor cost Data for year 1 show the following: Chairs Sales revenue Direct materials Direct labor Desks s 1,112,100 2,570,400 603,000 990,000 170,000 480,000 the value for each item below answered 10% out of 20% Profit margin for the desk Choose $238,000 100% 140% 2 Which of the two products $672,000 7 uestion
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