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Q10. Falcon Ltd has three products all of which require the same production facilities. Financial data on the three products are as follows: X Y
Q10. Falcon Ltd has three products all of which require the same production facilities. Financial data on the three products are as follows: X Y Z Product per unit per unit per unit Selling price per unit () 210 150 85 Variable Cost per unit () 90 80 35 Direct material per unit () 50 55 17 Direct Labour per unit () 40 25 18 Share of fixed cost per unit () 30 30 30 Monthly demand in units (units) 150 200 200 Machine time per unit (hours) 10 7 2 The same machine is used to produce all three products and hence, fixed cost is not affected. Fixed cost is 16,500 per month for all production. Machine time is limited to 1,550 hours per month. Labour is a variable cost for this project Required: With supported workings, show which combination of products to be produced to achieve the highest profit for the company. Clearly show your workings which shows the no_of units to be produced total contribution and total profit. (Total: 10 marks)
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