Figure 25-1
Hassel Company Manufactures Two Different Products, X and Y

question 13

Multiple Choice

Figure 25-1
Hassel Company manufactures two different products, X and Y. The company has 100 kgs of materials and 300 direct labour hours available for production.
The time requirements and contribution margins per unit are as follows: $\begin{array}{lrr}&\text { Product X }&\text { Product Y }\\\text { Contribution margin per unit } & £ 4 & £ 5 \\\text { Materials per unit (lbs.) } & 1 & 2 \\\text { Direct labour hours per unit } & 4 & 2\end{array}$
-Refer to Figure 25-1. What is the objective function for maximizing profits?

• A)Minimize £4X + £5Y
• B)Maximize £4X + £5Y
• C)Maximize £1X + £2Y
• D)Maximize £4X + £2Y

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Definitions:

Activity Variances

The differences between the expected costs of activities and the actual costs, used in managerial accounting to analyze performance.

Meals Served

The total number of meals prepared and provided to customers over a given period, often used in the hospitality or restaurant industry as a performance metric.

Cost Drivers

Factors that cause a change in the cost of an activity, such as machine-hours or labor hours, influencing direct and indirect costs.

Guests

Individuals invited to partake or be present in an event, establishment, or locale.