- - N . Q Search the web. a W F How SE X Parap w/ Comp | G Evalu H The T & The R .| Corp: | The L 3 Quee | & Full d | - Viet | G Evalu | G a. Cal Cour: | ) C A library.qol.qub.ac.uk/exampapers/Papers/ACC/ACC2005/ACC2005_2151ES2_1_95.pdf To . . . E SECTION A (answer ONE question from this section) 5 / 5 100% + Question 5 Beckenbauer pic is a manufacturer of sports articles. At present, the company produces four similar models of footballs for the 'Juro 2016 Championship' on industrial sewing machines. All employees and machines are capable of producing any of the products. At the initial stages of budget preparation, the cost forecasts for the current year and the demand for each of the products are estimated as follows: Northern Italy Spain Germany Ireland Unit sales 64,000 80,000 54,000 50,000 Sales price (per unit) E40.00 E30.00 E32.00 E35.00 Costs: Materials (per unit) E9.50 E11.25 E13.20 E11.00 Machine time (per unit) 6 mins 5 mins 10 mins 6 mins Labour time (per unit) 12 mins 10 mins 8 mins 12 mins Other variable overhead E1.50 E1.50 E1.50 $1.00 (per unit) Fixed costs are estimated to be f480,000 for the year and will be incurred at this level regardless of the mix of production undertaken. The cost per machine hour is variable at the rate of f120 per hour. All employees are paid $12 per hour. Requirement a) Calculate the weighted average contribution per unit. 5 Marks b) Assuming that Beckenbauer plc has a restriction of 32,000 labour hours in the year Activate Windows and does not want to increase prices above those shown above, what is the company's optimum production pattern and what profit will it make as a result of Go to Settings to activate Windows. this?- - N . Q Search the web. a W F How SE X Parap w/ Comp |G Evalu H The T | The R .| Corp: | The L | Quee | Fulld | 2 - Viet | G Evalu | G a. Cal * Cour: | ) C A library.qol.qub.ac.uk/exampapers/Papers/ACC/ACC2005/ACC2005_2151ES2_1_95.pdf To . . . E SECTION A (answer ONE question from this section) 5 / 5 100% + Fixed costs are estimated to be $480,000 for the year and will be incurred at this level regardless of the mix of production undertaken. The cost per machine hour is variable at the rate of f120 per hour. All employees are paid $12 per hour. Requirement a) Calculate the weighted average contribution per unit. 5 Marks b) Assuming that Beckenbauer plc has a restriction of 32,000 labour hours in the year and does not want to increase prices above those shown above, what is the company's optimum production pattern and what profit will it make as a result of this? 9 Marks C) Given the labour hours restrictions, suggest possible ways in which Beckenbauer plc might improve its overall profitability. 6 Marks d) In addition to the assumption of a restriction of 32,000 labour hours, due to a breakdown of one of the sewing machines there are only 12,000 machine hours available for the year. Outline a possible approach to providing an optimal production pattern in the above problem and argue, with calculations, why you would choose this approach (no determination of the actual production pattern is necessary). 5 Marks Total 25 Marks END OF EXAMINATION PAPER Page 5 of 5 Activate Windows Go to Settings to activate Windows
