Newton Manufacturing has 31,000 labor hours available for producing M and N. Consider the following information: Product M Product NRequired labor time per unit (hours) 2 3 Maximum demand (units) 6,500 8,000 Contribution margin per unit$5 $5.70 Contribution margin per labor hour$2.50 $1.90 If Newton follows proper managerial accounting practices in terms of setting a production schedule, how much contribution margin would the company expect to generate?
A. $63,100.
B. $66,700.
C. $31,450.
D. $78,100.
E. None of the answers is correct.
Answer: B
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