Watson Corporation Manufactures Two Products, XX and YY Assume Watson Corporation Could Produce and Sell Any Mix of Was

question 47

Multiple Choice

Watson Corporation manufactures two products, XX and YY.The following information was gathered: $\begin{array}{lrr}&XX&YY\\\text { Selling price per unit } & \$ 47.00 & \$ 26.00 \\\text { Variable cost per unit } & 42.00 & 22.00\\\text { Total fixed costs }&\$18,000\end{array}$ Assume Watson Corporation could produce and sell any mix of product XX and YY at full capacity.If product XX takes 50% longer to manufacture as product YY and only 120,000 hours of plant capacity are available, it is best for Watson to produce _____.

• A)only XX
• B)either XX or YY, there is no difference
• C)an equal number of XX and YY
• D)only YY

---

Definitions:

Moving Expenses

Costs associated with relocating for a job or business that are often deductible on an individual's taxes.

Full-Time Employee

An individual employed for a standard workweek, often defined by an employer as working a minimum number of hours, typically at least 35-40 hours per week.

AGI Deduction

Adjustments made to gross income in order to calculate the Adjusted Gross Income (AGI), affecting tax liability.

Health Insurance

A type of insurance coverage that pays for medical and surgical expenses incurred by the insured.