Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Serial Problem Business Solutions LO P3 Santana Roy has found that Business Solutions's line of computer desks and chairs has become very popular, and she

image text in transcribed
image text in transcribed
Serial Problem Business Solutions LO P3 Santana Roy has found that Business Solutions's 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 01.125 500 Selling price per unit Variable costs per unit Contribution margin per unit Direct labor hours per unit xpected demand for next quarter Chairs $ 375 200 $ 175 4 hours 50 chairs 5 hours 175 deska 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.) Desks Chairs Sales Variable costs Contribution per direct labor hour Desks Chairs Total 175 50 Maximum number of units to be sold Hours required to produce maximum units + For most profitable sales mix Desks Chairs Total 1,015 Hours dedicated to the production of each product Units produced for most profitable sales mix Contribution margin per unit Total contribution margin

Step by Step Solution

There are 3 Steps involved in it

Step: 1

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 For Undergraduates

Authors: James Wallace, Scott Hobson, Theodore Christensen

2nd Edition

1618533096, 9781618533098

More Books

Students also viewed these Accounting questions

Question

understand the function and value of professional associations, and

Answered: 1 week ago

Question

Are your goals SMART?

Answered: 1 week ago