While both racquets sell for $200, the contribution margin is $60 for Flexo and

Question

While both racquets sell for $200, the contribution margin is $60 for Flexo and $50 for Velocity. Flexo requires 4 ounces of fiberglass while Velocity requires 2 ounces of titanium.  The two racquets are produced on the same production line that has a maximum capacity of 3,500 labor hours, and a Velocity takes twice as many labor hours as the Flexo to produce.  Direct labor costs Prince Co. $10/hour, and each Flexo is charged direct labor of $20.  Prince Co. can only acquire 5,000 ounces of fiberglass, and 1,000 ounces of titanium, but can sell all the racquets it produces.

Explanation / Answer

total cost=$500

number of sales=1200

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