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b.GMA Limited has been approached by a customer who would like a special job to be done for him, and is willing to pay OMR
b.GMA Limited has been approached by a customer who would like a special job to be done for him, and is willing to pay OMR 45,000 for it. The job would require the following materials. Material Total units Units Book value of Realizable Replacement required already in units in stock value cost stock OMR/unit OMR/unit | OMR/unit 1200 0 17.000 B 1500 900 9.000 12.000 14.000 400 500 12.500 14.000 20.000 a) Material B is used regularly, and if units of B are required for this job, they would need to be replaced to meet other production demands. b) Materials C is in stock due to previous over-buying, and they have restricted use. The units of material C could be used in another job as a substitute for material M, which currently costs OMR 24 per unit (of which the company has no units in stock at the moment). Calculate the relevant costs of material A, B and C for deciding whether or not to accept the contract. As a management accountant, advise the management about the decision to be taken and justify your
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