Question
MetalMex, Ltd. , is engaged in the production and sales of two products for the automotive industry: product A and product B. The manufacturing process,
MetalMex, Ltd., is engaged in the production and sales of two products for the automotive industry: product A and product B. The manufacturing process, which is identical for each of the products can be briefly described as follows:
- In an initial phase the direct materials are converted in the cost centre of Manufacturing (unit of work: Mh);
- After this, there is a process of manual improvement in the Finishing cost centre (unit of work: Lh) in order products become ready to sell to customers.
There are additionally two service cost centres: Cleaning (unit of work: Lh) and General Services, which allocates costs to the remaining cost centres in the following proportion: 30% for the Manufacturing, 60% for the Finishing and 10% for the Cleaning.
For the month of January, the company has available the following information:
- Consumption of Direct Materials
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