Java Giant, Inc., produces two basic types of espresso makers, Model A and Model B. Pertinent data are:

The specialty coffee craze suggests that Java Giant can sell enough of either Model A or Model B to keep the plant operating at full capacity. Both products are processed through the same production departments.

Required
Which products should the company produce? Briefly explain youranswer.

Transcribed Image Text:

Per lIni Model A Model B $140.00 Selling price Costs $200.00 Direct material Direct manufacturing labor Variable manufacturing overhead Fixed manufacturing overhead Marketing (all variable) 56.00 30.00 50.00 20.00 28.00 184.00 $ 16.00 26.00 50.00 25.00 10.00 20.00 131.00 $9.00 Total cost Operating income