Todd Corporation Produces Two Products,P and Q

question 14

Multiple Choice

Todd Corporation produces two products,P and Q.P sells for $5 per unit; Q sells for $6.50 per unit.Variable costs for P and Q are $3 and $4.50,respectively.There are 4,300 direct labor hours per month available for producing the two products.Product P requires 4 direct labor hours per unit and Product Q requires 5 direct labor hours per unit.The company can sell as many of either product as it can produce.What is the maximum monthly contribution margin that Todd can generate under the circumstances? (Round to nearest whole dollar.)

• A)$2,150
• B)$1,505
• C)$1,500
• D)$2,250

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Definitions:

Fatty Plaque

Deposits of fat and other substances on the walls of arteries, leading to atherosclerosis and potentially heart disease or stroke.

Prolactin

A hormone produced by the pituitary gland that stimulates milk production and affects reproductive health.

Pituitary Gland

A small, pea-sized gland located at the base of the brain, responsible for regulating critical body functions through the release of hormones.

Milk Production

The biological process by which mammals produce milk to feed their young.