Question: Please help fix this wrong answer! Soft and Cuddly Friends (SCF) produces soft dolls. Demand for the dolls is increasing, and management wants you to


Please help fix this wrong answer!
Soft and Cuddly Friends (SCF) produces soft dolls. Demand for the dolls is increasing, and management wants you to identify an economical sales and production mix for the coming year. The following information is available: Softy Friendly Goody 75,000 62,800 52,500 $ 28.50 $ 13.50 $ 44.50 $ Besty 60,000 22.50 Lovey 107,000 $ 18.50 Demand (units) Price per unit Variable costs: Direct materials Direct labour 13.25 6.00 5.25 3.75 18.60 10.50 7.50 7.50 10.50 3.00 The following additional information is available: a. The company's plant has a capacity of 110,000 direct labour-hours per year on a single-shift basis. The company's present employees and equipment can produce all five products. b. The direct labour rate is $15 per hour this rate is expected to remain unchanged during the coming year. c. Fixed manufacturing costs amount to $730,000 per year. Variable overhead costs are $6 per direct labour-hour d. All of the company's sales and administrative costs are fixed. Required: 1. How many total direct labour-hours will be required to produce the units estimated to be sold during the coming year? Show your computations. (Round your answers to 2 decimal places.) Softy Friendly Goody Besty Lovey Answer is complete and correct. DLH Per Unit 0.40 0.25 0.70 0.50 0.20 2.Keeping in mind the direct labour-hour capacity, what should be the company's product mix for the upcoming year? Prepare a schedule in support of your recommendation (Round "Per Unit" to 2 decimal places.) Answer is complete and correct. Product Direct Labour- Hour Per Unit Softy Friendly Goody Besty Lovey Total hours required 0.40 hours 0.25 hours 0.70 hours 0.50 hours 0.20 hours Estimated Sales (Units) 75,000 62,800 52,500 60,000 107.000 Total Hours 30,000 15,700 36,750 30,000 21,400 133,850 3. What is the highest price, in terms of a rate per hour, that SCF would be willing to pay for additional capacity (i.e., for added direct labour time)? Answer is complete but not entirely correct. Highest price per $ 30 hour
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
