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Alpha Beta Gamma Total EOOO EOOO EOOO Variable costs Materials 5 15 Labour 12 27 Expenses 7 Allocated fixed costs 18IN NGNOA 33 Total cost
Alpha Beta Gamma Total EOOO EOOO EOOO Variable costs Materials 5 15 Labour 12 27 Expenses 7 Allocated fixed costs 18IN NGNOA 33 Total cost 183 / N0 9/N N Profit Sales revenue The amount of labour likely to be available amounts to $20,000. All of the variable labour is paid at the same hourly rate. You have been asked to prepare a statement of plans ensuring that at least 50 per cent of the budgeted sales revenues are achieved for each service, and the balance of labour is used to produce the greatest profit. Required: (a) Prepare a statement, with explanations, showing the greatest profit available from the limited amount of skilled labour available, within the constraint stated. Hint: Remember that all labour is paid at the same rate. (b) What steps could the business take in an attempt to improve profitability, in the light of the labour shortage
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