Problem 13-25 (Algo) Volume Trade-Off Decisions [LO13-5, LO13-6] The Waiton Toy Company manufactures a line of dolls and a sewing ki. Demend for the company's products is increasing, and manegement requests assistance from you in determining an economical sales and production mix for the coming yeac. The company has provided the following data: The folowing addionel information is available: a. The compscy's plant tias a capacity of 94,310 diect labor-hours per yoar on a single-shit basis. The company's present employees and equpment can produce al five products b. The orrect labor rste of $12 per hour is expected to remain unchanged during the coming yeat c. Fieed manufacturing costs total $650,000 per year. Veriablo overheed costs are $4 per olrect labor hour d. All of the company's norimanufacturing costs are fired. e. The compsny's finished goods imentory is negligible and can be ignored. Required: 1. How mary direct labor hours ace used to manufacture one unit of each of the company's five products? 2. How much variable ovethead cost is incurred to manufacture one unit of each of the company's five products? 3. What is the contribution maghas per direct laboe -hoir for each of the company/s the products? 4. Assuming that direct laboe-hours is the companys constraining resource, what is the highest total contriation margin that the company can earn if i makes optimal use of its conateained resource? 5. Assuming that the compary has made optimal use of its 94,310 diect wbor hours, what is tho highest direct labor rate per bour that Watton Toy Company woidd be willing to pay for additional capscity fthat is, for added diect labor timel