Deliberated costs of production

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Reference no: EM13111321

Dreamland Pillow Company sells the Old Softy model for $20 each. One pillow needs two pounds of raw material as well as one hour of direct labour to manufacture. Raw material costs $3 per pound as well as direct production labour is paid $4 per hour. Fixed supervisory costs are $2000 per month as well as Dreamland rents its factory on a five-year lease for $4,000 per month. All costs are deliberated costs of production. How many pillows should Dreamland produce and sell each month to earn a monthly gross profit of $1,000?

Reference no: EM13111321

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