The Walton Toy Company manufactures a line of dolls and a sewing kit. Demand for

the company's products is increasing, and management 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 additional information is available:

a$.$ The company's plant has a capacity of $152,800$ direct labor$-$hours per year on a

single$-$shift basis. The company's present employees and equipment can produce

all five products.

b$.$ The direct labor rate of $$7$ per hour is expected to remain unchanged during the

coming year.

c$.$ Fixed manufacturing costs total $$625,000$ per year. Variable overhead costs are

$$3$ per direct labor$-$hour.

d$.$ All of the company's nonmanufacturing costs are fixed.

e$.$ The company's finished goods inventory is negligible and can be ignored.

Required:

How many direct labor hours are used to manufacture one unit of each of the

company's five products?

How much variable overhead cost is incurred to manufacture one unit of each of

the company's five products?

What is the contribution margin per direct labor$-$hour for each of the company's

five products?

Assuming that direct labor$-$hours is the company's constraining resource, what is

the highest total contribution margin that the company can earn if it makes optimal

use of its constrained resource?

Assuming that the company has made optimal use of its $152,800$ direct labor$-$

hours, what is the highest direct labor rate per hour that Walton Toy Company would

be willing to pay for additional capacity $($that is$,$ for added direct labor time$)?$

$1.$How many direct labor hours are used to manufacture one unit of each of the company's

five products? $($Do not round intermediate calculations. Round your answers to $2$ decimal

places.$)$

$2.$How much variable overhead cost is incurred to manufacture one unit of each of the

company's five products? $($Do not round intermediate calculations. Round your answers to $2$

decimal places.$)$

$3.$What is the contribution margin per direct labor$-$hour for each of the company's five

products? $($Do not round intermediate calculations. Round your answers to $2$ decimal places.$)$

$4.$Assuming that direct labor$-$hours is the company's constraining resource, what is the

highest total contribution margin that the company can earn if it makes optimal use of its

constrained resource? $($Do not round intermediate calculations. Round your final answer to a

whole dollar amount.$)$

Highest total contribution margin

$5.$Assuming that the company has made optimal use of its $152,800$ direct labor$-$hours,

what is the highest direct labor rate per hour that Walton Toy Company would be willing

to pay for additional capacity $($that is$,$ for added direct labor time$)?($Do not round

intermediate calculations. Round your answers to $2$ decimal places.$)$

$\backslash$table$[[$Highest direct labor rate per hour,,per hour$]]$