Case: 1 The following particulars are extracted from the records of a company. Product B Particulars Sale price per unit Consumption of material Material cost Direct labour cost Direct expenses Machine hours used Fixed overheads per unit Variable overheads per unit Product A OMR 100 2 kg OMR 120 3 kg OMR 15 10 OMR10 15 5 3 2 OMR 10 20 OMR 5 15 Direct labour per hour is OMR 5. Comment on the profitability of each product [both use same raw material) when, I] total sales potential in units is limited II] total sales potential in value is limited III] raw material is in short supply IV) production capacity [in terms of machine hours] is limited. Assuming raw material as the key factor, availability of which is 10,000 kg and maximum sales potential of each product being 3500 units, find out the product mix which will yield maximum profits.

Case: 1 The following particulars are extracted from the records of a company. Product B Particulars Sale price per unit Consumption of material Material cost Direct labour cost Direct expenses Machine hours used Fixed overheads per unit Variable overheads per unit Product A OMR 100 2 kg OMR 120 3 kg OMR 15 10 OMR10 15 5 3 2 OMR 10 20 OMR 5 15 Direct labour per hour is OMR 5. Comment on the profitability of each product [both use same raw material) when, I] total sales potential in units is limited II] total sales potential in value is limited III] raw material is in short supply IV) production capacity [in terms of machine hours] is limited. Assuming raw material as the key factor, availability of which is 10,000 kg and maximum sales potential of each product being 3500 units, find out the product mix which will yield maximum profits.

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter10: Accounting Systems For Manufacturing Operations

Section: Chapter Questions

Problem 8CDQ: Describe the Source 01 the data for increasing Work in Process for (a) direct materials, (b) direct...

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