Production Data for the Number of Hours Required Per Unit

question 65

Multiple Choice

Production data for the number of hours required per unit for making the Droid and iPhone versions of cell phone components by Bizzer, a high-tech manufacturing firm, is given below. Suppose the plant decides exclusively to make either the maximum number of iPhone components or the maximum number of Droid phones. Which choice will result in the greater profit? Monthly Product

• A) Making Droid units will result in $4000 more profit.
• B) Making iPhone units will result in $250 more profit.
• C) Making Droid units will result in $250 more profit.
• D) Making iPhone units will result in $3750 more profit.

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Definitions:

Range of Values

A set of values that includes the minimum and maximum values within a given dataset.

Cash Basis

An accounting method where revenues and expenses are recorded when they are actually received or paid out in cash.

IRR

The Internal Rate of Return is a financial measurement tool used to assess the profitability of prospective investments.

Accounting Basis

The method used to record financial transactions; common methods include cash basis and accrual basis accounting.