Schmidt Company Makes Three Sizes of Shirts: Small,Medium and Large

Essay

Schmidt Company makes three sizes of shirts: Small,Medium and Large.The company uses one assembly line that has a limit of 600 labor hours per week.Schmidt Company can sell all the shirts it can make under current operating capacity.The following information is available:
Required:
A)Determine the weekly contribution margin when all the labor hours are allotted to the shirts with the highest selling price per unit.
B)Determine the weekly contribution margin when all the labor hours are allotted to the shirts with the highest contribution margin per unit.
C)Determine the weekly contribution margin when all the labor hours are allotted to the shirts with the highest contribution margin per labor hour.