Practice Homework Saved Help Save & Exit Check 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 constraint) in the production process is upholstery labor hours. Information concerning three of Portsmouth's products appears below: Hecline Sofa Love Beat Selling price per unit $1.290 5.2,070 $ 1,475 Variable cout per unit $ 750 $ 1,350 $1,050 Upholstery labor-hours per unit 9 hours 12 hours 5 hours Required: 1. Portsmouth is considering paying its upholstery laborers hourly compensation, in addition to their usual salaries, to work overtime. Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be Willing to pay to keep the upholstery shop open after normal working hours? 2. A small nearby upholstering company has offered to upholster furniture for Portsmouth at a price of $57 per hour. The management of Portsmouth is confident that this upholstering company's work is high quality and their craftsmen can work as quickly as Portsmouth's own croftsmen on the simpler upholstering Jobs such as the Love Seat How much additional contribution margin per hour can Portsmouth earn if it hires the nearby upholstering company to make Love Seats? 3. Should Portsmouth hire the nearby upholstering company? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Portsmouth is considering paying its upholstery laborers hourly compensation, in addition to their usual salaries, to work overtime. Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be willing to pay to keep the upholstery shop open after normal working hours? Maximum avertimo rate per hour Hantu Required 2 > 4 he Book 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 constraint) in the production process is upholstery labor-hours. Information concerning three of Portsmouth's products appears below: Recliner Sofa Love Seat Selling price per unit $ 1290 $ 2,070 $ 1,475 Variable cost per unit $ 750 $ 1,JSO $1,050 Upholstery labor-hours per unit 9 hours 12 hours 5 hours Required: 1. Portsmouth is considering paying its upholstery taborers hourly compensation, in addition to their usual salaries, to work overtime. Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be willing to pay to keep the upholstery shop open after normal working hours? 2. A small nearby upholstering company has offered to upholster furniture for Portsmouth at a price of $57 per hour. The manageme of Portsmouth is confident that this upholstering company's work is high quality and their craftsmen can work as quickly as Portsmouth's own craftsmen on the simpler upholstering jobs such as the Love Seat. How much additional contribution margin per hour can Portsmouth earn if it hires the nearby upholstering company to make Love Seats? 3. Should Portsmouth hire the nearby upholstering company? Hint rint ences Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 A small nearby upholstering company has offered to upholster furniture for Portsmouth at a price of $57 per hour. The management of Portsmouth is confident that this upholstering company's work is high quality and their craftsmen can work as quickly as Portsmouth's own craftsmen on the simpler upholstering jobs such as the Love Seat. How much additional contribution margin per hour can Portsmouth earn if it hires the nearby upholstering company to make Love Seats? Show less Additional contribution margin per hour Ches Portsmouth Company makes upholstered furniture. Its only variable cost is direct materials. The demand for the company's products for exceeds its manufacturing capacity. The bottleneck (or constrainty in the production process is upholstery labor hours. Information concerning three of Portsmouth's products appears below: Recliner Sota Love Beat Selling price per unit 5.1,290 12,070 $1,475 Variable cont per unit 3750 $ 1.350 5.1.050 Upholstery labor-hours per unit 9 hours 12 hours 5 hours Required: 1. Portsmouth is considering paying its upholstery laborers hourly compensation, in addition to their usual salaries, to work overtime Assuming that this extra time would be used to produce sofas, up to how much of an overtime rate per hour should the company be willing to pay to keep the upholstery shop open after normal working hours? 2. A small nearby upholstering company has offered to upholster furniture for Portsmouth at a price of $57 per hour. The management of Portsmouth is confident that this upholstering company's work is high quality and their craftsmen can work as quickly as Portsmouth's own craftsmen on the simpler upholstering Jobs such as the Love Seat. How much additional contribution margin per hour con Portsmouth earn if it hires the nearby upholstering company to make Love Seats? 3. Should Portsmouth hire the nearby upholstering company? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Should Portsmouth hire the nearby upholstering company? Yes No
