Question: a) Ehsan Manufacturing Sdn Bhd reported its financial condition as follows: sales RM100,000; cost of goods RM80,000; finance cost RM6,000; taxes at 25% RM3,500; and

a) Ehsan Manufacturing Sdn Bhd reported its

a) Ehsan Manufacturing Sdn Bhd reported its financial condition as follows: sales RM100,000; cost of goods RM80,000; finance cost RM6,000; taxes at 25% RM3,500; and profit RM10,500. The management of Ehsan plans to increase the profit. There are three alternatives i.e. increasing sales or reduction finance cost or reduction of production cost. Based on the experiences and capability of the company, sales can be increased 45%, finance cost can be reduced to 50% and 15% for production cost reduction. Differentiate the profits for each of the three option strategies. [15 Marks)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related General Management Questions!