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Santana Rey sees that Business Solutions's line of computer desks and chairs is popular, and she is finding it hard to keep up with
Santana Rey sees that Business Solutions's line of computer desks and chairs is popular, and she is finding it hard to keep up with demand. Santana only has 1,333 direct labor hours available. She must determine the best sales mix given her limited hours. Information about the desks and chairs follows. Selling price per unit Variable costs per unit Contribution margin per unit Desks $ 1,324.00 470.00 Direct labor hours per unit Maximum demand per quarter Required: $ 854.00 Chairs $ 459.00 120.00 $ 339.00 7 hours 163 desks 6 hours 43 chairs Determine the best sales mix and the contribution margin the business will earn at that sales mix. (Round per unit amounts to 2 decimal places.) Contribution margin per direct labor hour Maximum number of units to be sold Hours required to produce maximum units For most profitable sales mix Desks Chairs Desks Chairs Total 163 43 Desks Chairs Total Hours dedicated to the production of each product 1,333 Units produced for most profitable sales mix Contribution margin per unit Total contribution margin
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