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QUESTION SIX (A) Ebeyeyie Limited produces three products, A, B, and C. The selling price, variable costs and net profit for one unit of
QUESTION SIX (A) Ebeyeyie Limited produces three products, A, B, and C. The selling price, variable costs and net profit for one unit of each product follow: A B C Weekly demand (units) 1,000 200 600 GH GH GH Selling price 600 900 800 Direct materials costs 270 140 400 Direct labour costs 120 320 160 Variable overheads 30 88 80 40 Fixed overheads Total costs 60 60 60 480 600 660 Net profit 120 300 140 Due to a strike in the plant of one of its competitors, demand for the company's products, far exceed its capacity to produce. Management is trying to determine which product(s) to concentrate on next week in filling its backlog of orders. The direct labour rate is GH80 per hour, and only 3,000 hours of labour time are available each week.
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