35) Quality Chairs Inc.

Quality Chairs Inc. (QC) manufactures chairs for industrial use. Laura Winters, the Vice President for Marketing at CC, concluded from market analysis that sales were dwindling for 005 standard threeefoot chair due to aggressive pricing by competitors. QC's chairs sold for $910 whereas the competition's comparable chair was selling for $765. Winters determined that a price drop to $765 would be necessary to regain market share and reach a targeted annual sales level of10,000 chairs. Cost data based on sales of10.000 chairs: Budgeted Actual Quantity Quantity Actual Cost Direct materials (board Feet) 89,869 81,369 $1,259,669 Direct labor (hours) 72,259 74,675 876,866 Machine hours (hours) 12,396 12,159 251,869 Finishing and packing (hours) 7,496 7,366 126,869 The current prot per unit is