Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Blossom Industries manufactures chairs and tables that are in high demand by local office furniture stores. Following is information for each of these products: Chairs

Blossom Industries manufactures chairs and tables that are in high demand by local office furniture stores. Following is information for each of these products:

Chairs

Tables

Selling price per item

$84.00

$100.00

Variable cost per item

70.00

85.00

Contribution margin per item

$14.00

$15.00

Machine hours per item

1.60

1.60

Blossom has 1072 machine hours available each month. The demand for chairs is 640 units per month and the demand for tables is 420 units per month. In order to maximize the companys total contribution margin, how should Blossom allocate its production capacity between the chairs and tables?

420 tables and 250.00 chairs

420 tables and 640 chairs

670.00 chairs and 0 tables

670.00 tables and 0 chairs

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions