Grissom Products installs standard and deluxe storage sheds. Most of the install
ID: 2371196 • Letter: G
Question
Grissom Products installs standard and deluxe storage sheds. Most of the installation process of the sheds is done using direct labor. There are a maximum of 24,000 direct labor hours available each year.
Selected data related to each product is as follows:
Standard
Deluxe
Sales price per unit
$2,000
$4,000
Direct materials per unit
350
600
Direct labor per unit
250
350
Variable overhead per unit
100
200
Direct labor hours per unit
4
6
The company believes that there is sufficient demand for the sale and installation of up to 4,000 standard and 2,500 deluxe sheds each year.
Explanation / Answer
Standard Deluxe Sale price $ 2,000.00 $ 4,000.00 Total Varible cost $ 700.00 $ 1,150.00 Contribution per unit $ 1,300.00 $ 2,850.00 Direct labour hr required per unit 4 6 Contribution per direct labour hour $ 325.00 $ 475.00 Ranking II I In order for the company to maximize profits Company Should Installed Deluxe 2500 Standard 2250
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.