Just Juice Company processes different fruits into juices. The head office of this company is in Abu Dhabi. Three of it's processing plants are Just Mango, Just Orange and Just Mix (which produces a blend of various fruits). Just Mix is expected to manage its investments and make a profit. This division is enabled to make all procurement and investment decisions without requiring the approval of head office. Just Mango is expected to make fruit concentrate to supply to Just Mix and the outside market and may or not make a profit. Just Orange processes fruit into concentrate for Just Mix and the outside market, but can also process oranges into juice, if its managers think this is profitable.

The following are the budgetary responsibility reports for each of the three departments:

Just Just Mango Orange Just Mix Sales (units) 7,500 4,000 2,000 Sales ($) $1,750,000 $1,400,000 $1,200,000 Direct manufacturing costs Direct materials 90,000 80,000 10,000 Direct labour 62,000 40,000 12,000 Manufacturing overhead Variable manufacturing overhead 80,000 30,000 6,000 Rent 50,000 30,000 10,000 Insurance 5,000 2,000 1,000 Depreciation 75,000 100,000 40,000 Marketing and general administration expenses Advertising 100,000 30,000 5,000 Sales salaries 75,000 15,000 3,000 Printing 10,000 20,000 5,000 Travel 20,000 30,000 2,000 Investment in assets 1,000,000 1,200,000 800,000The actual responsibility reports for each of the three departments are provided below: Just Just Mango Orange Just Mix Sales (units) 7,000 4,500 3,000 Sales ($) $1,740,000 $1,460,000 $1,210,000 Direct manufacturing costs Direct materials 95,000 55,000 12,000 |Direct labour 60,000 48,000 10,000 Manufacturing overhead Variable manufacturing overhead 40,000 35,000 6,000 Rent 40,000 50,000 12,300 Insurance 5,000 2,000 1,000 Depreciation 80,000 90,000 56,000 Non- manufacturing overhead Advertising 100,000 30,000 5,000 Sales salaries 75,000 15,000 3,000 Printing 10,000 20,000 5,000 Travel 14,000 21,000 1,500 Investment in assets 1,000,000 1,200,000 800,000