You have been engaged with PQR Ltd, a manufacturing company to provide advice on the most profitable production plan for the company.

The company makes three products Alpha, Beta and Gamma and the appropriate data are as follows for the year 2022:

Cost per unit and selling price

	Alpha	Beta	Gamma
	RM	RM	RM
Selling Price	45.00	50.00	38.00
Direct Material Cost	12.5	15	7.5
Direct Labour Cost (RM4 per direct labour hour)	8	6	8

Additionnal Information

1. Variable overheads are absorbed at RM6 per direct labour hour
2. Fixed overheads total RM24,900.
3. Budgeted volume per annnum

Products	Units
Alpha	1,200 units
Beta	1,800 units
Gamma	1,500 units

There is a constraint on the direct labour hours, which is limited to 6,500 direct labour hours.

The sales director has already accepted an order for 100 ALPHA, 200 BETA and 400 GAMMA which must be supplied. These quantities are included in the market demand estimates above.

a.

Identify any shortfall for the year 2022 based on the above information.

(2 marks)

b.

Determine the production units of each product in order to maximise profit.

(15 marks)

c.

Calculate the maximum profit based on your answer obtained in (b) above.

(3 marks)

d.

Critically evaluate whether limiting factor and throughput accounting are the same thing. (20 marks)

(Total : 40 marks)

QUESTION 3

		More than a year into the COVID-19 pandemic, the world continues the fight to safeguard lives and livelihoods from the coronavirus. To ensure that companies are ready for the post-COVID-19 recovery, planning has becomes essential in sustaining businesses. Management accountants will therefore play a pivotal role in planning, organizing, leading, supervising, controlling and decision-making. Required:
		Critically evaluate the theories and concepts of management accounting techniques to support the management accounting process of planning, control and decision making. (20 marks)