MAF251 HELP

QUESTION 3 One Choice Sdn Bhd produces small components CPS, CPM and CPL to be incorporated into sets of car parts which are produced by local manufacturer. Currently the company supplies the small components to Carrie Bhd, one of the biggest car parts manufacturers. The production of the components by One Choice Sdn Bhd will depend on the order from Carrie Bhd. Each set of car part produced by Carrie Bhd needs four (4) units of component CPS, six (6) units of component CPM and three (3) units of component CPL. Normally Carrie Bhd receives a stable order of 2,500 sets of car parts per month. Information related to the small components produced by One Choice Sdn Bhd is given below: CPS CPM CPL RM RM RM Selling price per unit 25.00 17.00 15.00 Standard costs per unit: Direct material 9.00 6.00 5.00 Direct labour 6.00 4.00 3.00 Total overhead 3.00 4.50 5.00 (variable overhead is absorbed at RM2.00 per unit) Resources per unit: Direct labour hour 1.5 hours 2 hours 0.5 hour Machine hour 3 hours 2 hours 1 hour For the coming month, it is forecasted that the production of the components will increase due to the increase in car demand. People take the opportunity to buy car because of the tax exemption period announced by the government. The company has been informed by Carrie Bhd that the demand of the sets of car parts will increase by 10%. Since the demand is urgent, Carrie Bhd will rely on several other suppliers and is willing to accept any combination of component supplied by One Choice Sdn Bhd. @Hak Cipta Universiti Teknologi MARA CONFIDENTIAL CONFIDENTIAL 5 AC/MAY 2021/MAF251 Though sales could be increased, the production of the components cannot be expanded to meet the increase in car parts demand due to limited machine hour. Currently, the machine hours available are just enough to be utilized by the current production and sales. The engineering department suggesting upgrading the machine capacity and this will increase the current machine hours available by 500 hours. There is no shortage of labour hours. The current total fixed cost of the company is expected to increase by 5% due to machine upgrading. Required: a. Calculate the shortage of machine hours for the coming month. (3 marks) b. i. Predict the most optimal component mix to be produced by One Choice Sdn Bhd for the coming month. (10 marks) ii. Based on your prediction in part (b) (i) above, construct a profit statement to show the net profit of One Choice Sdn Bhd. (2 marks) C. Identify TWO (2) examples of scarce resources that are known as limiting factors. (2 marks) (Total: 17 marks)