Foxfield pic manufactures three types of bottles, Ql, Q2 and Q3. The following information relates to the standard raw material used to make each type of bottle.

The standard cost ofraw material is £0.30 per kilogramme and the bottles are always produced in the ratio of 4:3:1.
Total production quantities can vary from week to week. Company records show that in the last year the highest weekly production level achieved was 16,000 bottles and the lowest weekly production level wasjust 12,800 bottles.
The company employs a total of 10 production staff, each of whom is paid £140 per week, whatever production level is achieved. The number of staff that work on each type of bottle is as follows:

Production overheads are all fixed costs and total £5,400 per week. They are apportioned to each type of bottle in the ratio of 4:3:2 Required:

(a) Calculate how many bottles of each type were produced in the week with the highest production level and how many bottles of each type were produced in the week with the lowest production level. (2 marks)

(b) Calculate separately the cost ofproducing a single unit of each type of bottle when the weekly production level achieved is:
(i) 12,800 bottles in total (ii) 16,000 bottles in total.
Calculate the unit costs to four decimal places of a £. (17 marks)

(c) Completed bottles are sent to another company for cleaning, labelling and packing. This company employs several part-time personnel to clean, label and pack the bottles. These staff are paid on an incremental piecework basis. The details ofthe piecework scheme are as follows:

The figures below refer to the output achieved by three of the employees during a recent week

Calculate separately the amount payable to each of employees A, B and C based on the output achieved above.

Transcribed Image Text:

Bottle type Material QI Q2 Q3 300 grammes 400 grammes 500 grammes