em A v E 191 Paste x Update Available We've made some fixes and improvements. To complete the process, the X V WU CO Assessment 2023 Marginal Costing Techniques The summarised income statement for Ravinder Ltd, based on a budgeting selling price per unit is as follows : E000 540 Sales 18 per unit Direct material 108 Direct wages 78 Variable overhead 56 Fixed production overhead 80 Fixed administration overhead 44 30 Fixed selling overhead 396 144 Profit At a recent board meeting the directors discussed various options in order to improve profitability 6 and these are as follows: 1 In order to take into account the current economic conditions: Reduce selling price by 12.5% Change sales volumes to 44 (000) units 2 Increase marketing costs by (8000) 10 Increase selling price by 22.5% Increase variable overheads by 8% Setting a profit margin of 35% 1928 8482858838589 8 Required: Prepare marginal costing statements and a report to inform management of the consequences of the above alternative courses of action. Your report should also make reference to qualitative factors as well as quantitative factors Part B The firm is considering whether to make or buy component MD4 Quantity required 7,800 units Purchase price per unit E 6.70 Marginal production cost per unit E 4.80 The component would have to be made on a machine which is currently working at full capacity. If the firm decides to make the component, sales of a finished product will be reduced. Model CEO sales reduced by 580 units marginal cost 65 Selling price 90 Required: Recommend whether the firm should make or buy the component, referring to any qualitative factors which may affect the decision. Question Solution Workings Part B + Ready KAccessibility: Unavailable