Question
i actually subscribed to get an answer to this question: Williams Ltd manufactures and sells a single product. The selling price is R18. The following
i actually subscribed to get an answer to this question:
Williams Ltd manufactures and sells a single product. The selling price is R18. The following information relates to its yearly production and cost data. (Assume that there is no change to the stock level of the company.)
Year | Unit Volume | Total Cost R |
1 | 300 000 | 4 000 000 |
2 | 150 000 | 2 800 000 |
3 | 420 000 | 6 600 000 |
4 | 280 000 | 3 900 000 |
5 | 230 000 | 3 200 000 |
6 | 120 000 | 2 100 000 |
The manager of the company has an annual fixed salary of R80 000 and a yearly variable bonus which is equal to 2% of the operating profit. The maximum bonus is 50% of the annual salary. What would be the minimum desired level of sales revenue from the managers point of view if he wishes to maximise his income?
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