MANAGEMENT ACCOUNTING 2 : LIMITING FACTOR

Paete.Exclusive Design makes and sells scarf for local market The scarf comes in three different designs: Kayla, Arab and Gemersik. Below is the information table for production of scarf for next year: Selling_prioe per unit {RM} Variable ooet per unit {RM} Direct labour hourlunit Direct materiali'unit Forecasted sales (unit] Fixed costs {RM}: The management has provided the following information regarding the availability of the resources for the coming year: i. The maximum direct labour hours available for the ooming year will be 75.000 hours. No overtime is permitted and it is impossible to employ additional workers. ii. Materials will be supplied by two different suppliers due to unexpected problem faced by the current supplier A. The current supplier A can only supplies 55.000 meters and another 15,000 meters will be supplied by supplier 3. There is no opening or closing stocks available in the store. Required: a. Determine the limiting factorfor Paste Exclusive Design. (Show all relevant workings} [11 marks) bl Prepare the Statement of Prot for PasteExcluslye Design. (Show clearly the workings: Ranking schedule end production mitt} (26 marks) o. List THREE {3} qualitative factors that the company needs to consider In making the above decision. [3 marks)