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Dear tutors question below is based on management accounting 3. Kindly answer based on the marks given. Thank you Topic-STRATEGIC MANAGEMENT ACCOUNTING Question 1 Metallica
Dear tutors question below is based on management accounting 3. Kindly answer based on the marks given. Thank you
Topic-STRATEGIC MANAGEMENT ACCOUNTING Question 1 Metallica Co is an engineering company that manufactures a number of products, using a team of highly skilled workers and a variety of different metals. A supplier has informed Metallica Co that the amount of M1, one of the materials used in production, will be limited for the next three-month period. The only items manufactured using M1 and their production costs and selling prices (where applicable) are shown below: * Material M1 is expected to be limited in supply during the next three months. These costs are based on M1 continuing to be available at a price of RM20 per square metre. The price of M2 is RM10 per square metre. Required: (a) Calculate the contribution per unit for each product and determine the optimum production for the company using marginal costing approach. (6 marks) (b) Metallica Co carried out some market research which suggested that a change should be made to the selling price of both Product P4 and P6. As a result, the new contribution per unit for P4 is RM85 and for P6 it is RM95. Determine the revised optimum production plan for Metallica Co based on the change in selling price. (6 marks) (c) If Metallica Co-operated in a throughput accounting environment, calculate the profit-maximising output and the resulted profits. ( 8 marks) Step by Step Solution
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