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Rubega Ltd manufactures three products, Cup, Glass and Plate, all of which are made from one basic raw material and with the services of 75
Rubega Ltd manufactures three products, Cup, Glass and Plate, all of which are made from one basic raw material and with the services of 75 workers. Forecast costs and selling prices are as follows. Product Glass Cup 9 000 Plate 7 000 Sales per month (units) 12 000 $ $ $ Selling price per unit 72 74 58 18 25 16 Variable costs per unit: Direct material Direct labour Variable overheads 19 14 13 14 13 12 The total fixed costs are $250 000 each month. Required (a) Calculate the contribution per unit for each product. [3 marks] (b) Calculate the total monthly profit which can be achieved. [7 Marks] Due to a prospective strike in the forthcoming month of June, only 60 workers will attend work. No other shortages are expected. (c) Using the quantity of labour that will be available, prepare a statement to show the maximum profit that could be achieved for the THREE months ending 30 June 2017. [15 Marks]
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