Omega Company Reported the Following Information for the Company's Two

question 81

Multiple Choice

Omega Company reported the following information for the company's two products: $$\begin{array} { l c c } & \text { Product X } & \text { Product } Y \\\text { Selling price per unit } & \$ 3 5 & \$ 2 5 \\\text { Variable cost per unit } & 2 0 & 15\end{array}$$ Assume that 75,000 machine hours are available; product X takes four machine hours to produce,and product Y takes two machine hours to produce.The company can sell all it can make of either product.Which of the following statements is true?

• A) Product Y should be produced because more of it can be produced.
• B) Product Y should be produced because it will produce greater total profit.
• C) Product X should be produced because it provides a greater contribution margin.
• D) Both products provide the same total profit.

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Definitions:

Offeror

The party in a contract proposition who makes the offer to enter into an agreement, proposing terms to another party, the offeree.

Offeree

The party to whom an offer is made in a transaction or agreement.

Offeror

The party in a contract negotiation who makes a proposal or offer to another party for entering into an agreement.

Offeree

The person to whom an offer is made, typically in the context of contracts, where the offeree can accept, reject, or counteroffer.