Question
Precision electricals manufactured water heaters. In the first year of its operations, the revenue earned by the company was just sufficient to meet its costs.
Precision electricals manufactured water heaters. In the first year of its operations, the revenue earned by the company was just sufficient to meet its costs. To increase the revenue, the company analysed the reasons behind the low revenue. After analysis, the company has decided:
To reduce the labour costs by shifting the manufacturing unit to a backward area where labour was available at a very low rate.To start manufacturing solar water-heaters and reduce the production of electric water heaters slowly. This will not only help in covering the risks but also help in meeting other objectives.
(i). Identify and explain the objectives of management discussed above. (6 marks) (ii). Explain two values that the company is communicating to society by taking action to increase revenue? (4 marks)
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