please be inform thatthe formula used and process of how each number have been get mustbe mention

Short term decisionmaking  

Shot plc manufacturesthree types of furniture products - chairs, stools and tables. Thebudgeted unit cost and resource requirements of each of these itemsare detailed below:

                                Â	Chair   ($)	Stools($) Â	         Table($)
Timbercost              Â	5.00 Â	15.00 Â	10.00
Direct labour cost    Â	4.00 Â	10.00 Â	8.00
Variable overheadcost	3.00 Â	7.50 Â	6.00
Fixed overheadcost Â	4.50  Â	11.25  Â	9.00
                                Â	16.50  Â	43.75  Â	33.00
Budgeted volumes per annum                                   Â	4,000 Â	2,000 Â	1,500

These volumes arebelieved to equal the market demand for these products. The fixedoverhead costs are attributed to the three products on the basis ofdirect labour hours. The labour rate is $4.00 per hour. The cost oftimber is $2.00 per square metre. The products are made from aspecialist timber. A memo from the purchasing manager advises youthat because of a problem with the supplier it is to be assumedthat this specialist timber is limited in supply to 20,000 squaremetres per annum.

The sales directorhas already accepted an order for 500 chairs, 100 stools and 150tables, which if not supplied would incur a financial penalty of$2,000. These quantities are included in the market demandestimates above. The selling prices per unit of the three productsare:

-

Chair $20.00

Stool $50.00 Table$40.00

Required:

1. Determine the optimum production plan and state the net profitthat this should yield perannum.                                                                                                           
2. Discuss one qualitative factor that you should consider(especially in the long term) in your decision in part(a).