QUESTION39.

Aldebaran designs,

produces and markets two types of fireworks: Chinese Dragon and Space Tornado.

They are made from chemical components assembled in a single workshop.

The production parameters of these two products are given below:

The unit cost of chemical components is $1. Direct labor costs $4 per

hour in the shop. The operating costs of the machines are $3.5 per machine hour

in the workshop.

The Chinese Dragon is sold for $250 each while the Space Tornado is sold

for $350 each. Distribution is carried out by an import-export company which

receives a 5% commission on the sales made.

In July, we produced and sold 1,000 Chinese Dragons and 2,000 Space

Tornados.

What is the unit margin in $ of a Space Tornado?