Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

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

image

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 1,361 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 $ 1,509.50 540.00 Chairs $ 510.50 230.00 $ 969.50 $ 280.50 7 hours 161 desks Direct labor hours per unit Maximum demand per quarter Required: 6 hours 53 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.) Desks Chairs Contribution margin per direct labor hour Desks Chairs Total 161 53 Maximum number of units to be sold Hours required to produce maximum units For most profitable sales mix Desks Chairs Total Hours dedicated to the production of each product 1,361 Units produced for most profitable sales mix Contribution margin per unit Total contribution margin

Step by Step Solution

3.43 Rating (153 Votes )

There are 3 Steps involved in it

Step: 1

Answer To determine the best sales mix and the contribution margin for Business Solutions we need to calculate the contribution margin per direct labo... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: John Wild, Ken Shaw

5th edition

978-1259176494, 1259176495, 978-1259347641, 1259347648, 978-0078025600

More Books

Students also viewed these Accounting questions