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Swould be necessary t of 10.000 chairs:

Swould be necessary t of 10.000 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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Quality Chairs Inc. (QC) manufactures chairs for industrial use. Laura Winters, the Vice President for Marketing at QC, concluded from market analysis that sales were dwindling for QC's standard three-foot chair due to aggressive pricing by competitors. QC's chairs sold for $550 whereas the competition's comparable chair was selling for $495. Winters de that a price drop to $495 would be necessary to regain market share and annual sales of 10,000 chairs. Cost data based on sales of 10,000 chairs: Direct materials (board feet) Direct labor (hours) Machine hours (hours) Finishing and packing (hours) The current profit per unit is: $250. $300. $400. $450. $475 O O C O Budgeted Quantity Actual Quantity 88,000 79,500 73,775 71,350 11,400 11,250 6.500 6,400 Actual Cost $1,250,000 875,000 250.000 125.000
Transcribed Image Text:Quality Chairs Inc. (QC) manufactures chairs for industrial use. Laura Winters, the Vice President for Marketing at QC, concluded from market analysis that sales were dwindling for QC's standard three-foot chair due to aggressive pricing by competitors. QC's chairs sold for $550 whereas the competition's comparable chair was selling for $495. Winters de that a price drop to $495 would be necessary to regain market share and annual sales of 10,000 chairs. Cost data based on sales of 10,000 chairs: Direct materials (board feet) Direct labor (hours) Machine hours (hours) Finishing and packing (hours) The current profit per unit is: $250. $300. $400. $450. $475 O O C O Budgeted Quantity Actual Quantity 88,000 79,500 73,775 71,350 11,400 11,250 6.500 6,400 Actual Cost $1,250,000 875,000 250.000 125.000
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