Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Marketing Manager of Dotcom Limited has conducted a market research on the price-demand relationship for its consumer durable Product-V which has been recently launched.

image text in transcribed

The Marketing Manager of Dotcom Limited has conducted a market research on the price-demand relationship for its consumer durable Product-V which has been recently launched. The price-demand pattern will be as follows Product-V is manufactured in batches of 1.000 units. The production manager of Dotcom Limited has also researched and studies the pattern and believes that 50% of the variable manufacturing cost would have a learning effect. This learning curve effect will continue up to 4.000 units of production at constant rate. But after 4.000 units of production. unit variable manufacturing cost would be equal to the unit cost at the 4: batch. The manufacturing unit cost of the first batch will be Rs. 6.600 of which only 50% is subjected to learning and experience curve effect. The average unit variable of all 4 batches will be Rs 6.180 The price and maximum contribution at which Dotcom Limited should sell Product-V is Rs.14,400, Rs. 24,496,137 Rs. 16.650, Rs 27,419.374 Rs.16,050, Rs. 23,866,137 Rs.13,050, Rs. 26.579,374 The Marketing Manager of Dotcom Limited has conducted a market research on the price-demand relationship for its consumer durable Product-V which has been recently launched. The price-demand pattern will be as follows Product-V is manufactured in batches of 1.000 units. The production manager of Dotcom Limited has also researched and studies the pattern and believes that 50% of the variable manufacturing cost would have a learning effect. This learning curve effect will continue up to 4.000 units of production at constant rate. But after 4.000 units of production. unit variable manufacturing cost would be equal to the unit cost at the 4: batch. The manufacturing unit cost of the first batch will be Rs. 6.600 of which only 50% is subjected to learning and experience curve effect. The average unit variable of all 4 batches will be Rs 6.180 The price and maximum contribution at which Dotcom Limited should sell Product-V is Rs.14,400, Rs. 24,496,137 Rs. 16.650, Rs 27,419.374 Rs.16,050, Rs. 23,866,137 Rs.13,050, Rs. 26.579,374

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost Accounting A Managerial Emphasis

Authors: Charles T. Horngren, George Foster, Srikant M. Datar

10th International Edition

0130851779, 978-0130851772

More Books

Students also viewed these Accounting questions

Question

Appreciate the legal implications of employment documentation

Answered: 1 week ago