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q-18. due by 1145pm est usa. BeachBody Company manufactures three models of office chairs: economy, basic and deluxe. Product information for March is provided below,
q-18. due by 1145pm est usa.
BeachBody Company manufactures three models of office chairs: economy, basic and deluxe. Product information for March is provided below, computed at production levels of 200 of each chair.
Economy | Basic | Deluxe | |
Unit sellingprice........................................................ | $150 | $210 | $320 |
Unit manufacturingcosts:.......................................... | |||
Variable................................................................ | -$40 | -$80 | -$200 |
Fixed*.................................................................... | -$20 | -$45 | -$70 |
Unit Variable sellingcosts........................................... | -$30 | -$30 | -$30 |
Net income per unit (computed from amounts above) | $60 | $55 | $20 |
Machine-hours perunit............................................... | 4mhrs | 4mhrs | 3mhrs |
*Fixed manufacturing costs of $27,000 are assigned based on direct labor hours. The costs are unavoidable.
If BeachBody has excess capacity, and there is unsatisfied demand for all three products, which model should they produce?
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