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ENCUELARE QUESTION 4: Eye Red Company Limited manufactures four products namely, Alata soap, Anago semina, Naiga soap and Ayigbe soap. All the soaps incorporate a
ENCUELARE QUESTION 4: Eye Red Company Limited manufactures four products namely, Alata soap, Anago semina, Naiga soap and Ayigbe soap. All the soaps incorporate a secret fragrant, lavinda, which gives them their unique flavor. Sadly, supplies of lavinda are limited, so management must decide how best to use the supplies it has. Information on the products is as follows: Alata soap Anago semina Naiga soap Ayigbe Soap GH GH GH GH Selling price 100 150 200 200 Variable cost 80 80 100 70 Fixed cost 30 30 30 30 Units of lavinda required 100 units 100 units 150 unit 200 units Required: a) Should the company continue producing Alata soap? (6 marks) c) Under what circumstances would the company continue the production of Alata Soap? (4 marks)
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