1. ABC limited produces 3 products X, Y and Z. The following information is available. It uses one type of material Alpha to produce all the three products.

Product X Y Z

Demand (units) 3,000 2,500 2,000

Variable cost to make ($ per unit) 14 15 11

Buy-in price ($ per unit) 13 18 12

Kg of Alpha required per unit 1kg 1.5kg 2kg

(Included in variable cost)

Required:

The availability of Material Alpha is limited to 7000 kg. Based on the available material suggest if the material is sufficient to produce all the products. (Calculate surplus or shortfall.)