Custom Furniture Manufactures a Small Table and a Large Table

question 128

Multiple Choice

Custom Furniture manufactures a small table and a large table. The small table sells for $900, has variable costs of $560 per table, and takes ten direct labor hours to manufacture. The large table sells for $1,500, has variable costs of $980, and takes eight direct labor hours to manufacture. Calculate the contribution margin per direct labor hour for the large table.

• A)$65 per direct labor hour
• B)$66 per direct labor hour
• C)$67 per direct labor hour
• D)$68 per direct labor hour

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Definitions:

Dissociated Partner

A partner who has withdrawn from a partnership, thereby ending his or her involvement with the business.

Liability

The legal responsibility or obligation to compensate for harm caused, debts owed, or for fulfilling specific duties.

LLP

Limited Liability Partnership, a legal structure for a business where partners' liabilities are limited to their investment in the partnership.

Continuing Liability

An ongoing financial or legal responsibility that does not end upon the termination of a contract or agreement.