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Narly Skateboards manufactures three different product lines, Base, Long, and Trick. Considerable market demand exists for all models. The following per unit data apply: Base

Narly Skateboards manufactures three different product lines, Base, Long, and Trick. Considerable market demand exists for all models. The following per unit data apply:

Base Model

Long Model

Trick Model

Selling price

$100

$120

$140

Direct materials

12

12

12

Direct labor ($12 per hour)

24

24

48

Variable support costs ($4 per

machinehour)

8

16

16

Fixed support costs

20

20

20

How can the Vicepresident of sales at Skate Magic encourage her salespeople to promote the more profitable model?

A. Provide higher sales commissions for higher priced items and items with the greatest contribution margin per constrained resource.

B. Provide higher sales commissions for higher priced items.

C. Put all sales persons on salary.

D. Provide higher sales commissions for items with the greatest contribution margin per constrained resource.

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