octoring Enabled. FINAL EXAM - Summer 2024 9 Saved [15 points] A company produces three products, Round, Square, and Triangle, with the following costs and selling prices: Round Square Triangle Selling price per unit $24 $26 $20 00:42:50 Variable cost per unit $10 $10 $12 Machine Hour usage per unit 2 MH 4 MH 4 MH (MH) Help Save & Exit Sub The company has a limit of 14,800 machine hours available per month. The company has a monthly fixed cost of $30,000. The demand for each of the products is 2,500 units per month. The company's goal is to maximize its profitability. Suppose the company can rent a machine that will provide an additional 1,100 machine hours per month. What is the maximum monthly rent the company would be willing to pay for this machine?

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter16: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 2CE
Question
octoring Enabled. FINAL EXAM - Summer 2024
9
Saved
[15 points] A company produces three products, Round, Square, and Triangle, with the following costs and selling prices:
Round
Square
Triangle
Selling price per unit
$24
$26
$20
00:42:50 Variable cost per unit
$10
$10
$12
Machine Hour usage per unit
2 MH
4 MH
4 MH
(MH)
Help
Save & Exit
Sub
The company has a limit of 14,800 machine hours available per month. The company has a monthly fixed cost of $30,000. The demand for each of the products is 2,500 units per
month. The company's goal is to maximize its profitability.
Suppose the company can rent a machine that will provide an additional 1,100 machine hours per month. What is the maximum monthly rent the company would be willing to pay for
this machine?
Transcribed Image Text:octoring Enabled. FINAL EXAM - Summer 2024 9 Saved [15 points] A company produces three products, Round, Square, and Triangle, with the following costs and selling prices: Round Square Triangle Selling price per unit $24 $26 $20 00:42:50 Variable cost per unit $10 $10 $12 Machine Hour usage per unit 2 MH 4 MH 4 MH (MH) Help Save & Exit Sub The company has a limit of 14,800 machine hours available per month. The company has a monthly fixed cost of $30,000. The demand for each of the products is 2,500 units per month. The company's goal is to maximize its profitability. Suppose the company can rent a machine that will provide an additional 1,100 machine hours per month. What is the maximum monthly rent the company would be willing to pay for this machine?
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