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Question 4 Company C makes and sells three types of products for which the following information is available: Standard cost and selling prices per unit:
Question 4 Company C makes and sells three types of products for which the following information is available: Standard cost and selling prices per unit: Product type (RM) Direct material Direct labour department 1 Direct labour department 2 Variable overheads Selling price 250 'Y' (RM) 110 55 32 20 320 Z (RM) 153 70 44 28 458 mmte mundo Fixed costs for the period are RM400.000. Direct labour from department 2, which is highly skilled. is available for 25,000 hours only in a period and is paid RM8 per hour. Both direct labour from departments 1 and 2 are variable costs. The maximum demand for the product is: 'X 'Y' Z 2,000 units 3,000 units 1,800 units Required: (a) Calculate the shortage in hours of direct labour from department 2. (8 marks) (b) Calculate the best production plan and the maximum profit that could be achieved from the plan. (17 marks) [Total: 25 Marks)
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