Superior Containers produces restaurant storage containers. The company makes two sizes of containers: regular (55 gallon) and large (100 gallon). Demand for the products is so high that Superior can sell as ma to produce both sizes. The machinery can be run for only 2,500 hours per period. Superior can produce 20 regular containers every hour, whereas it can produce 8 large containers in the same amount of time. Fixed costs amount to $250,000 per period. Sales prices and variable costs are as follows: 2. ny of each size as it can produce. The company uses the same machinery Regular Large er Unit $2 $10 ales price 4 ariable costs To maximize profits, how many of each size container should Superior produce? Given this product mix, what will the company's operating income be? 1. Backyard Living sells its barbecue sets for $170 each. Suppose the company incurs the follo average cost per barbecue set: Direct materials Direct labor Variable manufacturing overhead Variable selling expenses Fixed manufacturing overhead" Total cost $1,800,000/75,000 units $52 28 24 $120 Backyard L ving has enough idle capacity to accept a one-time-only special order from Superstore for 2,000 barbecue sets at a sales price of $130 per set. Backyard Living will not incur $2 of variabl selling expenses for this order. How would accepting the order affect Backyard Living's operating income