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: Selling Demand Next Price per Product year (units) Unit Debbie 75,000 $ 28.00 Trish 67,000 $ 5.70 Sarah 60,000 $ 33.50 Mike 36,000 $ 18.00 Seving kit 350,000 $ 10.50 The following additional information is available: Direct Materials Direct Labor $ 5.20 $ 4.80 $ 2.10 $ 1.36 $ 10.19 $ 7.20 $ 4.50 $ 5.60 $ 5.70 $ 0.96 tes The company's plant has a capacity of 164,990 direct lobor-hours per year on a single-shift basis. The company's present a employees and equipment can produce all five products. b. The direct labor rate of $8 per hour is expected to remain unchanged during the coming year. Fixed manufacturing costs total $635,000 per year. Variable overhead costs are $4 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: 1. How many direct labor hours are used to manufacture one unit of each of the company's five 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 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? 5. Assuming that the company has made optimal use of its 164.990 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 lobortime)? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 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.) Dobble Trish Sarah Mike Sewing Kit Direct labor hours per unit 4.80 X 1.36 7.20 5.60 X 0.96 Required Required 2 > Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 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.) Debble Trish Sarah Mike Sewing Kit Contribution Margin per DLH $ 13.90 7.29 28.00 26.00 9.17 XS Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Assuming that the company has made optimal use of its 164,990 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.) Highest direct labor rate per hour $10.70 per hour
