Solved

The Garrison Company Manufactures Two Products: Oxy Cleaner and Sonic

Question 43

Multiple Choice

The Garrison Company manufactures two products: Oxy Cleaner and Sonic Cleaner. The costs and revenues are as follows:
 Oxy  Sonic  Clearner  Clearner  Sales Price $75$44 Variable cost per unit 4021\begin{array} { l r r } & \text { Oxy } & \text { Sonic } \\& \text { Clearner } & \text { Clearner } \\\text { Sales Price } & \$ 75 & \$ 44 \\\text { Variable cost per unit } & 40 & 21\end{array}
Total demand for Oxy is 10,000 units and for Sonic is 6,000 units. Machine time is a scarce resource. During the year, 50,000 machine hours are available. Oxy requires 4 machine hours per unit, while Sonic requires 2.5 machine hours per unit.
-
What is the maximum contribution margin Garrison can achieve during a year?


A) $444,250.
B) $1,014,000.
C) $488,000.
D) $855,500.

Correct Answer:

verifed

Verified

Unlock this answer now
Get Access to more Verified Answers free of charge

Related Questions