need 100 correct answer only

5 = 2,00,0 required New Pared Cost Cost Reduction Target in Fixed Cost 6 N 18 (New) Wote: comput will be require So, Fixed Cost = Contribution p.u. X BEQ. Note: BEQ Fored Cost Contributionpu. 50 (W Pro 5 Target Costing - Labour Time to achieve desired Profit - Other Effects year. The Committee submits a Draft Budget as detailed below: Zen Ltd forms a Committee consisting of its Production, Marketing and Finance Directors to prepare a budget for the next 24 39 9 6 26 25,000 units 6,50,000 5,00,000 1,50,000 . Selling Price Per Unit Direct Material Cost Per Unit Direct Labour Cost Per Unit Variable Overhead (3 hrs. *2) Contribution Per Unit Budgeted Sales Quantity Budgeted Contribution (25,000 * 26) Budgeted Fixed Cost Budgeted Profit Committee to prepare a budget to earn atleast a profit of 73,00,000. To achieve the Target Profit, the Committee reports back The Management is not happy with the budgeted profit as it is almost equal to the previous year's profit. Therefore, it asks the with the following suggestions: The Unit Selling Price should be raised to 55. The Sales Volume should be increased by 5,000 units. To attain the above said increase in Sales, the Company should spend 40,000 for advertising. The production time per unit should be reduced. To win the acceptance of the workers in this regard the hourly rate should be increased by * 3 per unit besides an annual group bonus of 30,000. There is no change in the annount and rates of other expenses. The Company has sufficient production capacity. As the implementation of the above proposal needs the acceptance of the workforce to increase the speed of work and to reduce the production time per unit, the Board wants to know the extent of reduction in per unit Production Time. Required: (i) Calculate the Target Production time per unit and the time to be reduced per unit. c) Identify the other problems that may arise in production due to decrease in unit production time and also suggest the remedial measures to be taken. (iii) State the most suitable situation for the adoption of Target Costing. . . Loquirement No.fi 1,50,000 Budgete Budgeted Contribution (25,000 26) Budgeted Fixed Cost Budgeted Profit The Management is not happy with the budgeted profit as it is almost equal to the previous year's profit. Therefore, it asks the Committee to prepare a budget to earn atleast a profit of 3,00,000. To achieve the Target Profit, the Committee reports back with the following suggestions: The Unit Selling Price should be raised to 55. The Sales Volume should be increased by 5,000 units. To attain the above said increase in Sales, the Company should spend = 40,000 for advertising. The production time per unit should be reduced. . . . . To win the acceptance of the workers in this regard the hourly rate should be increased by 7 3 per unit besides an annual group bonus of 30,000. There is no change in the arnount and rates of other expenses. The Company has sufficient production capacity. As the implementation of the above proposal needs the acceptance of the workforce to increase the speed of work and to reduce the production time per unit, the Board wants to know the extent of reduction in per unit Production Time