Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Mountaineer Products manufactures two types of tents: SingleWall and DoubleWall. Selected data related to each type of tent is as follows: SingleWall DoubleWall Sales price

Mountaineer Products manufactures two types of tents: SingleWall and DoubleWall. Selected data related to each type of tent is as follows:

SingleWall

DoubleWall

Sales price

$350

$275

Direct materials

25

52

Direct labor

20

39

Variable overhead

17

10

Direct labor hours

6

3

Total fixed manufacturing overhead is $150,000. Most of the manufacturing process is done by workers. For the upcoming year, there is a maximum of 21,000 direct labor hours available. Management believes there is sufficient demand for 3,000 SingleWall and 4,000 DoubleWall tents each year.

At the optimum solution, what is the maximum total contribution margin if there is unlimited demand for DoubleWall and SingleWall tents?

a.

$1,038,000

b.

$1,008,000

c.

d.

$1,218,000

$1,128,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditors Letter Handbook

Authors: American Bar Association Business Law Section

2nd Edition

161438973X, 978-1614389736

More Books

Students also viewed these Accounting questions