Question 1: Points 20 Hitchcock Industries has developed two new products but has only enough plant capacity to introduce one of these products this year. The company controller has gathered the following data to assist management in deciding which product should be selected for production. Hitchcock's fixed overhead includes proportional rent and utilities, machinery depreciation, and supervisory salaries. Selling and administrative expenses are not allocated to products. Power Drill Power Saw Cost per unit Raw materials Machining at $12/hr. Assembly at $10/hr. Variable On at $8/hr. Fixed O/H sty 44/hr. Total unit cost: Suggested selling price Actual research and development costs Proposed advertising and promotion costs $22.00 9.00 15.00 18.00 9.00 $73.00 $88.98 $180,000 $300,000 $18.00 750 5.00 9.00 4.50 $44.00 $49.95 $95,000 $250,000 Research and development costs for Hitchcock's two new products are