Newton Manufacturing has 78,500 labor hours available for producing M and N. Consider the following information:

	Product M				Product N
Required labor time per unit (hours)		5				6
Maximum demand (units)		6,500				8,000
Contribution margin per unit	$	12.00			$	12.60
Contribution margin per labor hour	$	2.40			$	2.10

If Newton follows proper managerial accounting practices in terms of setting a production schedule, how much contribution margin would the company expect to generate?

Multiple Choice

• $77,100.

• $174,000.

• $174,600.

• $178,800.

• None of the answers is correct.