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Product B RM30 The following standard data are available for Atlas Sdn. Bhd.: Rate per hour Product A Direct materials per unit RMIO Direct labor:
Product B RM30 The following standard data are available for Atlas Sdn. Bhd.: Rate per hour Product A Direct materials per unit RMIO Direct labor: Grinding RM5.00 7 hours Finishing RM7.50 15 hours Selling price per unit RM206.50 Budgeted production units 1.200 units Maximum sales units for the period 1,500 units 5 hours 9 hours RM168.00 600 units 800 units Notes: (1) No closing stocks are anticipated. (2) The skilled labor used for the grinding processes is highly specialised and in short supply. It will not be possible to increase the supply for the budgeted period. REQUIRED: (a) Prepare a statement showing the total contribution from each product based on the budgeted production. (9 Marks) (b) Prepare a statement showing the total contribution that could be obtained if the optimum use was made of the skilled grinding labor. (9 Marks) c) Consider briefly any qualitative factors which may be considered in making this decision that will impact these products in the long term. (2 Marks)
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