Farris Company Reported the Following Information for Its Two Products

question 25

Multiple Choice

Farris Company reported the following information for its two products: $\begin{array}{|l|c|c|}\hline & \text { Product } \mathrm{X} & \text { Product Y } \\\hline \text { Selling price per unit } & \$ 25 & \$ 35 \\\hline \text { Variable cost per unit } & 15 & 20 \\\hline\end{array}$ Due to labor constraints,demand for each of the products is greater than its supply.Product X requires 1 hour of labor to produce and product Y requires 3 hours of labor to produce.Which of the following statements is

• A) Product X should be produced and sold because it has a lower cost than Product Y.
• B) Product X should be produced and sold because it provides a higher contribution margin per labor hour than Product X.
• C) Product Y should be produced and sold because it provided a higher contribution margin per unit than Product X.
• D) Product Y should be produced and sold because it provides more revenue than Product X.

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Definitions:

Interactive

Refers to systems, media, or activities that allow for two-way communication or participation, engaging users through direct involvement.

Consumer Controlled

Pertains to markets or marketing strategies where consumers directly influence product features, prices, or distribution methods.

Entertainment Oriented

describes businesses, activities, or services designed primarily to provide amusement, enjoyment, or leisure rather than fulfilling a practical or necessary function.

Direct Marketing

A strategy that involves promoting products or services directly to customers, bypassing traditional retail channels.