Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Pharoah Industries manufactures chairs and tables that are in high demand by local office furniture stores. Following is information for each of these products: Chairs
Pharoah 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 | $78.00 | $95.00 | ||
Variable cost per item | 61.00 | 77.00 | ||
Contribution margin per item | $17.00 | $18.00 | ||
Machine hours per item | 1.60 | 1.60 |
Pharoah has 1024 machine hours available each month. The demand for chairs is 610 units per month and the demand for tables is 390 units per month. If Pharoah allocates its production capacity between the chairs and tables so that it maximizes the company's contribution margin, what will the total contribution margin be?
a. $11270
b. $11520
c. $17390
d. $10880
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started