Problem 13-25 (Algo) Volume Trade-Off Decisions [L013-5, L013-6] The Walton Toy Company manufactures a line of dolls and a sewing kit Demand for the company's products is increasing, and management requests assistance from you in determining an economical sales and production mix for the coming year. The company has provided the following data: $4.40 $1.76 Ss. 20 $1.36 Product S a rah Sewing kit Next year (units) SS, ooo 4S,ooo SS, ooo 32, ooo ooo Selling Price per Unit 7.00 $29.00 $13.00 Materials $1.40 Labor The following additional information is available: a. The company's plant has a capacity of 137,510 direct labor-hours per year on a single-shift basis. The company's present employees and equipment can produce all five products. b. The direct labor rate of $8 per hour is expected to remain unchanged during the coming year. c. Fixed manufacturing costs total $550,000 per year. Variable overhead costs are $2 per direct labor-hour. d. All of the company's nonmanufacturing costs are fixed. e. The company's finished goods inventory is negligible and can be ignored.