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Question(s) / Instruction(s):

A company manufactures three different product lines: Model X, Model Y and Model Z. Considerable market demand exists for all three models. Financial data per unit are below:
                                               Model X        Model Y       Model Z
Selling price                                   $50            $60           $70
Direct materials                                 6               6             6
Direct labor ($12 per hour)                     12              12            24
Variable overhead costs ($4 per machine hour)   4               8              8
Fixed overhead costs                              10            10            10
If there is excess capacity, which model is the most profitable to produce
a) Model X
b) Model Y
c) Model Z
d) Both models X and Y

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