Santana Rey has found that Business Solutionss line of computer desks and chairs has become very popular, and she is finding it hard to keep up with demand. She knows that she cannot fill all of her orders for both items, so she decides she must determine the optimal sales mix given the resources she has available. Information about the desks and chairs follows.

	Desks			Chairs
Selling price per unit	$	1,125		$	375
Variable costs per unit		500			200
Contribution margin per unit	$	625		$	175
Direct labor hours per unit		5	hours		4	hours
Expected demand for next quarter		175	desks		50	chairs

Santana has determined that she only has 1,015 direct labor hours available for the next quarter and wants to optimize her contribution margin given the limited number of direct labor hours available. Required: Determine the optimal sales mix and the contribution margin the business will earn at that sales mix. (Round per unit amounts to 2 decimal places.)

	desk	chairs
contribution per DL
	desk	chairs	total
maximum units to be sold	175	50
hours required to produce maximum
For most profitable sales mix:
	desk	chairs	total
hours dedicated to the product			1015
units produced
contribution margin per unit
total contribution margin