If a company has the capacity to produce either 10,000 units…

If a company has the capacity to produce either 10,000 units of Product A or 10,000 units of Product B; assuming fixed costs are the same, production restrictions are the same for both products, and the markets for both products are unlimited; the company should commit 100% of its capacity to the product that has the higher contribution margin.

Honey Hollow Hills Academy had the following results of oper…

Honey Hollow Hills Academy had the following results of operations for the past year: Income Statement Honey Hollow Hills Income Statement Sales (50,000 units at $21.50) $1,075,000 Materials and direct labor    (645,000) Overhead (20% variable)      (85,000) Selling and administrative expenses (all fixed)     (103,450) Operating income  $    241,550   A foreign company (whose sales will not affect Honey Hollow Hill’s regular sales) offers to buy 5,000 units at $10.50 per unit. In addition to variable manufacturing costs, there would be transportation costs of $1,400 in total on these units. Prepare an analysis of this additional business to show whether Honey Hollow should take this order.  ***You must show your work to receive full credit.***