Assume That Widgeon Produced Enough of the Product with the Highest

question 143

Multiple Choice

Assume that Widgeon produced enough of the product with the highest contribution margin per unit to use 1,000 hours of machine time. Product demand does not warrant any more production of that product. What is the maximum additional contribution margin that can be realized by utilizing the remaining 1,000 hours on the product with the second highest contribution margin per hour?

• A) $35,000
• B) $7,000
• C) $4,000
• D) $28,000

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Definitions:

Financial Reports

Documents that detail the financial health and performance of a business, including balance sheets, income statements, and cash flow statements.

Rent Expired

The portion of the rental period that has elapsed or the cost of rent that has been used up over a specific accounting period.

Accounting Period

A specific time span for which financial records are maintained and reported, such as a fiscal year or quarter.

Accumulated Depreciation

The total amount of an asset's cost that has been allocated as depreciation expense since the asset was put into use.