The following additional information is ovailable about flight 482 : a. Members of the flight crew are paid fised annual salaries, whereas the flight assistants are paid based on the number of round trips they complete. b. One-third of the Hability insurance is a speclal charge assessed against flight 482 because in the opinion of the insurance company. the destinntion of the flight is in a "high-tisk" area. The remaining two thinds would be unalfected by a decision to drop flight 482. c. The baggage loading and tilight preparation expense is an allocation of ground crews' salaries and depreciation of ground equlpment. Dropping fight 482 would have no effect on the company's total baggage louding and fight preparation expenses. d. If flight 482 is dropped, Pegasus Airlines has no authorization at present to replace it with another flight. e. Aircraft depreciation is due entirely to obsolescence. Depreciation due to wear and tear is negligible. 1. Dropping fight 482 would not allow Pegasus Airlines to reduce the number of aircraft in its fleet or the number of flight crew on its payroll. Required: 1. What is the financial advantage (disadvantage) of discontinuing flight 482 ? The Walton Toy Company manufactures a line of dolls and a sewing kit. Demand for the company's products is increasing, and monogement requests assistance from you in determining an economical sales and production mix for the coming year, The company has provided the following data: The following odditional information is avaliable: a. The companys plant has a copacity of 113,140 direct labor-hours per year on a single-shift batis. The company's present employees and equipment can produce all five products. b. The direct labor rate of $9 per hour is expected to remain unchanged during the coming year. c. Fived manufacturing costs total $630,000 per yeor. Variable overhead costs ore $2 per direct labor-hour. d. All of the companys nonmanufocturing costs are fixed. e. The company's finished goods inventory is negligible and can be ignored. Required: 1. How many direct lobor hours are used to manufacture one unit of each of the company stive products? 2. How much variable overhead cost is incurred to manufacture one unit of each of the company's five products? 3. What is the contribution margin per direct labor-hour for each of the company's five products? 4. Assuming that direct labon-hours is the compary's constraining resource, what is the highest fotal contribution margin that the company can earn if it makes optimal use of its constrained resource? 5. Assuming that the company has made optimat use of its 113,140 direct labor-hours, what is the highest direct fabor rate per hour that Walton Toy Company would be willing to pay for additional capacity (that is, for addied direct labor time)