For the Upcoming Year,there Is a Maximum of 4050 Direct

question 23

Multiple Choice

For the upcoming year,there is a maximum of 4050 direct labour hours available.Management believes that the demand for both the standard and deluxe detailing is limited to 900 each per year.If the company maximises profits,what is the maximum contribution margin the company could have in the upcoming year?

• A) $ 67 500
• B) $175 500
• C) $162 000
• D) $ 60 750

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Definitions:

Intra-Entity Transactions

Transactions that occur within the same legal entity, often between departments or divisions, which may require elimination during consolidation.

Net Income

The remaining profit for a company after deducting taxes and expenses from the revenue.

Consolidation Entry

A journal entry used in the preparation of consolidated financial statements to eliminate intercompany transactions and balances.

Retained Earnings

The portion of net income that is retained by the company rather than distributed to its shareholders as dividends.