Exercise 10-6 Managing a Constrained Resource [LO10-6] Portsmouth Company makes upholstered furniture. Its only variable cost is direct materials. The demand for the company's products far exceeds its manufacturing capacity. The bottleneck (or constriant) in the production process is upholstery labor-hours. Information concerning three of Portsmouth's upholstered chairs appears below: Sofa $1,790 $1,250 Love Seat $1,470 $1,150 4 hours Recliner Selling price per unit Variable cost per unit Upholstery labor-hours per unit $1,196 $700 8 hours 12 hours Required 1. Portsmouth is considering paying its upholstery laborers additional compensation to work overtime Assuming that this extra time would be used to produce sofas, up to how much of an overtime premium per hour should the company be willing to pay to keep the upholstery shop open after normal working hours? Maximum amount payable per hour