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Decker Products
Decker Products Manufactures Standard and Deluxe Wooden Swing

Question 29

Multiple Choice

Decker Products
Decker Products manufactures standard and deluxe wooden swing sets. Selected data related to each product is as follows:
 Standard Deluxe  Sales price per unit $900$2000 Direct materials per unit 100500 Direct labour per unit 300700 Variable overhead per unit 50100 Machine hours per unit 48\begin{array}{lrr}&\text { Standard}& \text { Deluxe }\\\text { Sales price per unit } & \$ 900 & \$ 2000 \\\text { Direct materials per unit } & 100 & 500 \\\text { Direct labour per unit } & 300 & 700 \\\text { Variable overhead per unit } & 50 & 100 \\\text { Machine hours per unit } & 4 & 8\end{array}
Most of the manufacturing process for the sets is done on machines. There is a maximum of 10 000 machine hours available each year.
-If demand were strong for both sets and the company could sell an unlimited number of either style,what is the maximum total contribution margin the company could have?


A) $ 875 000
B) $ 281 250
C) $1 125 000
D) $1 750 000

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