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Lazy Days Furniture manufactures two products: Couches and Rocking Chairs. The following data are available:   Couches Rocking Chairs Sales price $500.00 $480.00 Variable cost ratio 55% 25% The company can manufacture two couches per machine hour and one rocking chair per machine hour. The company's production capacity is 900 machine hours per month. To maximize profits, what product(s) and how many units should the company produce in a month? (Assume unlimited demand for both products)   Select one: a. 700 couches and 360 rocking chairs b. 1,800 couches c. 900 rocking chairs d. 900 couches e. 1,800 couches and 900 rocking chairs

Lazy Days Furniture manufactures two products: Couches and Rocking Chairs. The following data are available:   Couches Rocking Chairs Sales price $500.00 $480.00 Variable cost ratio 55% 25% The company can manufacture two couches per machine hour and one rocking chair per machine hour. The company's production capacity is 900 machine hours per month. To maximize profits, what product(s) and how many units should the company produce in a month? (Assume unlimited demand for both products)   Select one: a. 700 couches and 360 rocking chairs b. 1,800 couches c. 900 rocking chairs d. 900 couches e. 1,800 couches and 900 rocking chairs

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Lazy Days Furniture manufactures two products: Couches and Rocking Chairs. The following data are available:

 

Couches

Rocking Chairs

Sales price

$500.00

$480.00

Variable cost ratio

55%

25%
The company can manufacture two couches per machine hour and one rocking chair per machine hour. The company's production capacity is 900 machine hours per month.


To maximize profits, what product(s) and how many units should the company produce in a month? (Assume unlimited demand for both products)


 

Select one:
a. 700 couches and 360 rocking chairs
b. 1,800 couches
c. 900 rocking chairs
d. 900 couches
e. 1,800 couches and 900 rocking chairs
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