management accounting

1. Bella Corporation is a small company making two products with the following financial details: Bella simple Bella deluxe E E Selling price 16 24 Variable costs 6 16 The weekly fixed costs are $3,000 The use of resources by each product is: Bella simple Bella deluxe Material 45 0.4 kg 1.1kg Material 96 2 kg 1.5kg Machine time 4 minutes 3 minutes Labour time 15 minutes 25 minutes The materials are difficult to obtain and are made by only one supplier. There will be a delay in delivery of the ingredients for the next week so Bella Corporation will use the ingredients in inventory of: Material No.45 - 500 kg, Material No.96 - 1,000 kg The weekly machine capacity is 40 hours. The weekly labour time is 200 hours. Five employees are paid for a 40 hour week even if there is not enough work to fill 40 hours. The corporation can sell all of its production. Required: a ) Using a graphical approach calculate the most profitable production quantities for the week, given the constrained resources and calculate the net income which will be made. (12 marks)