question 3: since employees are paid for 40-hour work weeks, assume direct labor is a fixed cost. Compute the contribution margin per welding hour for (a) Manufactured WVD drums and (b) Manufactured bike frame.?

*I NEED THE ANSWER TO \#2) WHICH IS DOWN AT THE BOTTOM** Chapter 11 Analytical Thinking: Tulstuff, inc. selts a wide range of drums, bins, bouss and other containters that are used in the chemical industry. One of the company's productils a heavyduty, corrovion-restant metal drum, called the Wro drum, used to rtore toxc wate. Production is constrained by the capaciy of an automated welding machine that is used to maie precision welds. A total of 2.000 hours of welding time is avallable annualy on the machine. Because each drum fequires 0.4 hours of weldirg machine tirne, anfual production it lmited to 5.000 drums. At present, the welding machine is used erclubvely to make the WND drums. The accounting department has nevided the follawine financial data concernina the WVD drums. Managemeat beleves 6,000 WVD drums could be sold each year if the company had sufficient manufacturing capacity. As an alterrative to adding another weldine machine, management has considered buying additional drums from an outside suppler. Harcer industries, Inc., a wppler of quality products, would be able to provide up to 4,000 WVD-type drums per year at a price of $138 per drum, which Tufstuff would resell to its customers at its normal selling price after appropriate relabeling. Megan flores, Tutstuffs production manager, has wggested the company could make better ase of the welding machine by 0.5 welding machine timeff manufacturing ble frames, which would requice only 0.5 hours of welding machine time per frame and yet sell for far more than the up to 1,600 bies / year drums. Megan believes that Tulstuff could sell up to 1,600 blie frames per year to bise manufacturens at a price of $239 each. The $232/ ilke accounting department has orovided the followine data concernine the orocosod new neoduct: The bike frames could be produced wath exating equipment and personnet. Manufacturing overhead is allocated to products on the MoHi Fired basis of direct labor hours. Most of the manulacturing overhead consists of fixed common costs such as rent cn the factory bulding. but 1.35 per Wrid inum some of it is variable. The variable manufacturing overhead has been estimated at $1.35 per WvD drum and 51.90 per bie frame. The 1.90 per bike frame varlable manufacturine overhead cost would not be incurred on drums acquired from the outside supplier. VMOHt: not incurted