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SECTION B: Answer any TWO (2) out of FOUR (4) questions QUESTION 3 Johnson Company produces and sells four products curtains, bed sheets, blankets
SECTION B: Answer any TWO (2) out of FOUR (4) questions QUESTION 3 Johnson Company produces and sells four products curtains, bed sheets, blankets and pillow sets. Selling prices and costs per unit are as follows: Products Curtains RM Bed sheets Blankets Pillow sets RM RM RM Selling price 1000 750 650 250 Variable costs Direct materials (RM5 per meter) 350 150 120 100 Direct labour 100 80 80 60 Variable overheads 20 18 15 18 Johnson Company had planned to produce and sell the forthcoming of the products in the year-end-sales festival: Products Curtains Bed sheets Blankets Pillow sets Quantities (units) 1,500 1,200 800 1,200 Since preparing the above sales plan, Johnson Company has been advised that it will be able to purchase a maximum of 180,000 meters of direct materials in the forthcoming period. Required: a. Calculate the contribution per unit for each product. (5 marks) b. Calculate the total contribution for each product based on the original sales plan. (3 marks) Page 5 of 11 111 SEGI College PROGRAMME: DIPLOMA IN ACCOUNTANCY/ DIPLOMA IN BUSINESS ADMINISTRATION Kota Damansara c. Determine the amount of material (in meters) that each product should use to maximize contribution (12 marks) d. Calculate the total contribution for each product based on the plan in (c) above. (5 marks) (Total: 25 marks)
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