Requirement 3. Chapter 26, Problem 1CPP Chegg study workbook solutions for Horngren's Managerial Accounting (12th Edition)

Division C also produces two product lines. Because the division can sell all of the product it can produce, Dillard is expanding the plant and needs to decide which product line to emphasize. To make this decision, the division, the accountant assembled the following data:

PER UNIT

	K707	G582
Sales Price	$84	$50
Variable Costs	24	21
Contribution margin	$60	$29
Contribution Margin Ratio	71.4%	58.0%

So after expansion, the factory will have a production capacity of 4,700 machine hours per month. The plant can manufacture either 40 units of K707s or 62 units of G582s per machine hour.

A. Identify the constraining factor for Division C.

B. Prepare an analysis to show which product line to emphasize.

Answer format

(What is constraint or issue in production?) (answer)

3B

	K707	G582
(1) Units produced per hour	(answer)	(answer)
(2) Contribution margin per unit	(answer)	(answer)
Contribution margin per machine [ (1) x (2) ]	excel does	excel does
(answer of explanation of which to emphasize and why)