Ellaria Corporation is a small medium enterprise located at Pahang. The business manufacture traditional water container...
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Ellaria Corporation is a small medium enterprise located at Pahang. The business manufacture traditional water container made from clay. As the business had marketed their product on online platforms, the demand is increasing steadily. Production of the product utilizes two types of materials. Half of the variable selling overhead is commission paid to salesmen. The following information was provided on Comprehensive of the business for current year production RM Sales (45,000 units) Less: Material A Material B Labour Variable Manufacturing overhead Variable selling and distribution Fixed manufacturing overhead Fixed selling and distribution Net profit (a) 292,500 36,000 67,500 (b) 162,000 112,500 144,000 23,500 Currently the business is operating at 75% of its maximum capacity and the marketing team are working intensely to generate more revenue for the business. (C) RM 1,125,000 Additional information: The marketing team engaged in a local product expo and received a proposal from an international buyer to purchase 10,000 units of traditional water container. The buyer request for each unit of the product to be labelled with their corporate logo and the product to be package in an exclusive container. The labelling cost and packaging cost per unit is RM0.50 and RM2.40. However the buyer negotiated to have the bulk purchase of the order to be priced at RM20 per unit. Required (838,000) 287,000 Compute the current contribution margin per unit of the product Based on the proposal by the international supplier, analyze whether the business should accept the order at price level of RM20 per unit. Given that the same buyer proposed another proposal to purchase 20,000 units of product with the same requirements and price. But this time it required for the product to be delivered internationally that will cost RM1,500. Determine whether the business should accept the order. Show all the calculations. Ellaria Corporation is a small medium enterprise located at Pahang. The business manufacture traditional water container made from clay. As the business had marketed their product on online platforms, the demand is increasing steadily. Production of the product utilizes two types of materials. Half of the variable selling overhead is commission paid to salesmen. The following information was provided on Comprehensive of the business for current year production RM Sales (45,000 units) Less: Material A Material B Labour Variable Manufacturing overhead Variable selling and distribution Fixed manufacturing overhead Fixed selling and distribution Net profit (a) 292,500 36,000 67,500 (b) 162,000 112,500 144,000 23,500 Currently the business is operating at 75% of its maximum capacity and the marketing team are working intensely to generate more revenue for the business. (C) RM 1,125,000 Additional information: The marketing team engaged in a local product expo and received a proposal from an international buyer to purchase 10,000 units of traditional water container. The buyer request for each unit of the product to be labelled with their corporate logo and the product to be package in an exclusive container. The labelling cost and packaging cost per unit is RM0.50 and RM2.40. However the buyer negotiated to have the bulk purchase of the order to be priced at RM20 per unit. Required (838,000) 287,000 Compute the current contribution margin per unit of the product Based on the proposal by the international supplier, analyze whether the business should accept the order at price level of RM20 per unit. Given that the same buyer proposed another proposal to purchase 20,000 units of product with the same requirements and price. But this time it required for the product to be delivered internationally that will cost RM1,500. Determine whether the business should accept the order. Show all the calculations.
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Related Book For
Principles of Information Systems
ISBN: 978-0324665284
9th edition
Authors: Ralph M. Stair, George W. Reynolds
Posted Date:
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