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Moorehead Manufacturing Company produces two products for which the following data have been tabulated. Fixed manufacturing cost is applied at a rate of $1.00 per machine hour.
The sales manager has had a $160,000 increase in the budget allotment for advertising and wants to apply the money to the most profitable product. The products are not substitutes for one another in the eyes of the company's customers. Suppose the sales manager chooses to devote the entire $160,000 to increased advertising for BD-4. The minimum increase in sales dollars of BD-4 required to offset the increased advertising would beA. $160,000 B. $320,000 C. $960,000 D. $1,600,000 |