14.14 Juniper Jefferson Limited manufactures two models of baby buggy: the de luxe and the super de luxe. There is currently a shortage of the special grade of aluminium required for the buggy frame. This is unlikely to be a long-term problem, but it will affect production over the next 3 months. The cost and selling price information for each model is as follows:

De luxe Super de luxe

£ £

Selling price 150 165 Variable cost of raw materials Aluminium (at £8.50 per kg)

38.25 42.50 Other raw materials 12.50 15.00 Variable cost of labour 13.65 15.60 The company has 350 kg of aluminium in stock and expects to be able to buy no more than a further 1000 kg per month for the next 3 months.
You are required to:
i) Calculate the contribution per unit of limiting factor for both models of buggy.
ii) Advise the directors on the production plan they should follow, assuming that:

a) demand for the de luxe will be 800 units over the next 3 months, with demand for the super de luxe at 300 units over the same period; or

b) demand for the de luxe will be 600 units over the next 3 months, with demand for the super de luxe at 400 units over the same period.