Question
QUESTION ONE a) A company made sales of $720,000 incurring total variable costs of $384,000 and fixed costs of $256,000. The companys selling price of
QUESTION ONE a) A company made sales of $720,000 incurring total variable costs of $384,000 and fixed costs of $256,000. The companys selling price of $150 per unit has remained constant over a long period of time and is not expected to change in the coming financial period.
Sketch the companys break-even and profit volume charts at a production level that is 20% above the current [6 Marks]
b) XYZ Ltd produces one product which passes through two processes, the output from process 1 becoming the input to process 2. for March 2016, the following figures are available:
Process 1 ($) Process 2 ($) Inputs 10,000 units 60,000 Labour 25,800 35,100 Overhead 12,900 17,550 Normal loss 10% of input 10% of input Closing work in process 1,000 units 500 units Output 7,600 units 6,000 nits Scrap value of losses ($) 4 per unit 14 per unit Closing work in process in both processes is complete as to materials, and 50% complete as to labour and overhead costs.
Required: i. Process 1 account [3 Marks]
ii. Process 2 account [3Marks]
c) The following relevant production and cost data for a small manufacturing company over the period January to December 2022 (output in units and cost in thousands of dollars) Month Jan Feb Mar April May June July Aug Sept Oct Nov Dec Output 270 256 330 342 300 360 286 316 330 346 360 330 Cost 6580 6412 7980 8400 7364 8260 6972 7616 7840 8064 8484 7756
Estimate the cost in August 2023 when production is expected to be 250 units using Regression analysis [4 Marks]
d) An interviewee takes 10 minutes to finish the fourth trial on a task and 8 minutes on the sixth trial. Regular line employees achieve consistency after 50 performances where they take an average of 2 minutes on the 50th performance. Should this employee be hired for this job given that he is expected to benefit from the effects of the learning curve? [4 Marks]
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started