Question
Generation Furniture Company manufactures and sells oak tables and chairs. Price and cost data for the furniture follow: Tables Chairs Sales Price $500 $50 Variable
Generation Furniture Company manufactures and sells oak tables and chairs. Price and cost data for the furniture follow:
| Tables | Chairs |
Sales Price | $500 | $50 |
Variable manufacturing costs | 345 | 7 |
Sales commission (6%) | 30 | 3 |
Generation Furniture has three sales representatives: Al, Brody, and Camara. Al sold 60 tables with 6 chairs each. Brody sold 80 tables with 4 chairs each. Camara sold 50 tables with 8 chairs each.
Requirements:
1. | Calculate the total contribution margin and the contribution margin ratio for each sales representative (round to two decimal places). |
2. | Which sales representative has the highest contribution margin ratio? Explain why. |
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