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Please explain for points! 20 . Kawasaki sells motorcycles Ninja Z X -6R and Ninja ZX-14R . The Ninja ZX-6R sells for $10,000, has variable

Please explain for points!

20.

Kawasaki sells motorcycles Ninja ZX-6R and Ninja ZX-14R. The Ninja ZX-6R sells for $10,000, has variable cost (labor and material) of $2,000, and requires 10 hours of use of machinery to produce. The Ninja ZX-14R sells for $12,000, has variable costs (labor and material) of $8,000, and requires 2 hours of use of machinery to produce. Kawasaki has excess capacity of 5,000 hours of use of machinery. Which motorcycle should it produce?

A)

The Ninja ZX-6R because it has a higher contribution margin of $8,000.

B)

The Ninja ZX-14R because it has a higher contribution margin per hour of machinery use of $2,000.

C)

The Ninja ZX-6R because it has a higher contribution margin per hour of machinery use of $4,000.

D)

The Ninja ZX-14R because it has a higher contribution margin of $4,000.

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