Business, 26.11.2021 21:10 jakebuttone

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 $650 whereas the competition's comparable chair was selling for $570. Winters determined that a price drop to $570 would be necessary to regain market share and reach a targeted annual sales level of 10,000 chairs. Cost data based on sales of 10,000 chairs:

Budgeted QuantityActual QuantityActual Cost
Direct materials (board feet) 88,500 80,000 $1,252,500
Direct labor (hours) 71,600 74,025 875,500
Machine hours (hours) 11,650 11,500 250,500
Finishing and packing (hours) 6,750 6,650 125,500
If the profit per unit is maintained, the target cost per unit is:

A. $81.
B. $171.
C. $181.
D. $276.
E. $226.

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Quality Chairs Inc. (QC) manufactures chairs for industrial use. Laura Winters, the Vice President f...

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