Qhaleeda Bakery produce three types of cake, choclate cheese, manggo cheese and pandan cheese. This products consume the same types of special flour, known as Bunga Tanjung. The owner of bakery, Alana was toldthat for next four month, this flour will be in limited supply.

The following information given:

Choclate Cheese

RM

Manggo Cheese

RM

Pandan Cheese

RM

Selling price

12.00

18.00

15.00

Variable cost

4.00

8.00

6.00

Overhead cost:

- Indirect Material

- Indirect Labor

2.00

1.00

4.00

2.00

3.00

1.50

Consumption of Flour, Bunga Tanjung

0.4 kg

0.6 kg

0.5

Additional information:

There is an additional indirect material cost for manggo cheese and pandan cheese, RM1.00 and RM0.50 respectively.

Required:

i)Calculate which types of cake should be ranked first, second and third in terms of contributing to profits.

(6 marks)

ii)Advise Alana which cake should be produce or sold. Why?

(2 marks)