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Question Hill Company Ltd. is in the production of mosquito coil, the company's variable cost is Ghc 20 per unit and a selling price per
Question Hill Company Ltd. is in the production of mosquito coil, the company's variable cost is Ghc 20 per unit and a selling price per unit of Ghc 40. Hill Company has the following Fixed Cost; - Rent Ghc 10,000 Insurance Ghc 6,000 Rates Ghc 8,000 Depreciation Ghc 16,000 Required: a) Calculate Hill Company's total cost if it makes 1000 units, 2000 units and 4000 units. (7 marks) b) Calculate Hill Company's break-even units (5 marks) c) As the Management accountant of Hill Company, advice them from your computation above, the required units of production and sell. (3 marks) Question a) ZAAP Company Ltd. received an order to manufacture 4,000 units of notes books in its job number 72. Material per unit for production is $2, labour cost per unit is $1, job 72 will need total of 3,000 labour hours to complete. The company has a total of $40,000 of overheads per month and total labour hours of 20,000 per month. It absorbs overheads by labour hours to jobs. Required: Calculate the total cost of job 72 and the cost per unit. (6 marks)
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