Question
Required : Operating profit for 2 0 2 2 and 2 0 2 3 GreenTech specialises in manufacturing and selling high-quality, sustainable Smart Televisions. These
Required : Operating profit for and
GreenTech specialises in manufacturing and selling high-quality, sustainable Smart Televisions. These televisions offer advanced features such as 4K resolution, smart connectivity, voice control, and streaming services integration. GreenTech aims to capture a significant share of the global Smart TV market. The following data relates to GreenTech's best selling Sustainable Smart TV Model SMTV007. Metric Units Produced and sold (SMTV007) selling Price per Unit (SMTV007) Direct Materials (kilos) Direct Materials Cost per kilo Manufacturing Capacity (units) Conversion Costs Conversion Costs per Unit of Capacity Selling and Customer-Service Capacity (customers) Total Selling and Customer-Service Costs Selling and Customer-Service Cost per Customer 2022 5,000 $400 15,000 $40 10,000 $1,000,000 $100 60 $360,000 $6,000 2023 5,500 $440 15,375 $44 10,000 $1,100,000 $110 58 $362,500 $6,250 GreenTech Corporation produces no defective units but it wants to reduce direct materials usage per unit of SMTV007 in 2023. Manufacturing conversion costs in each year depend on production capacity defined in terms of SMTV007 units that can be produced. Selling and customer-service costs depend on the number of customers that the customer and service functions are designed to support. GreenTech Corporation has 46 customers in 2022 and 50 customers in 2023. The industry market size for Sustainable Smart Screens increased 5% from 2022 to 2023.
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