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Darren Company Produces Three Products with the Following Costs and Selling

question 139

Multiple Choice

Darren Company produces three products with the following costs and selling prices:
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$\begin{array}{lrrrrr}&\text {X}&\text {Y}&\text {Z}\\\text { Selling price per unit } & \$ 40 & \$ 30 & \$ 35 \\\text { Variable costs per unit } & 24 & 16 & 20 \\ \text { Contribution margin per unit } & \$ 16 & \$ 14 & \$ 15\\\text { Direct labor hours per unit } & 4 & 2 & 3 \\\text { Machine hours per unit } & 5 & 7 & 4\end{array}$

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If Darren has a limit of 30,000 machine hours but no limit on units sold or direct labor hours, then the ranking of the products from the most profitable to the least profitable use of the constrained resource is:

Definitions:

Affiliate Dividends

Affiliate dividends refer to the distribution of earnings paid to shareholders of a subsidiary or an affiliate company.

Outstanding Shares

The total number of shares of a corporation that have been issued and are currently held by investors, including public shareholders and company officers.

Dividends Paid

The portion of a company's earnings that is distributed to its shareholders as a return on their investment.

Investment Account

An account held at a financial institution which allows an individual to deposit funds and make investments in securities and other assets.