NUR Berhad is a company producing tables. After discussing with the marketing manager, the production manager...

Transcribed Image Text:

NUR Berhad is a company producing tables. After discussing with the marketing manager, the production manager planning to focus on producing a product named AFI. The marketing manager is observing on two states, Selangor and Pahang, the sales at both states is expected to be RM500,000 an RM810,000 respectively. Information related to the cost per unit of the production for both states are as follows: SELANGOR (RM) PAHANG (RM) ETT Seling price Direct material 100 135 40 45 Direct labour 10 15 Overhead 20 30 50% of the overhead in SELANGOR and PAHANG are fixed. Required: (Each question is to be treated independently) a. Classify the cost incurred into variable cost per unit and total fixed cost for both states. (4 marks) b. Calculate the followings and show all your workings. i. The break-even point (in unit and sales value) for both states. i. The margin of safety (in unit) for both states. i. Advice to the management in which state should the company sell AFİ. (10 marks) e. Marketing manager suggested the company should sell AFI in both states as he is convinced the market would be good. However, the direct material cost will increase by 10%. Advice the management on how many additional units to be sold for both states, assuming other information remains unchanged and NUR Berhad would like to maintain its annual profit. (Calculate to the nearest unit). NUR Berhad is a company producing tables. After discussing with the marketing manager, the production manager planning to focus on producing a product named AFI. The marketing manager is observing on two states, Selangor and Pahang, the sales at both states is expected to be RM500,000 an RM810,000 respectively. Information related to the cost per unit of the production for both states are as follows: SELANGOR (RM) PAHANG (RM) ETT Seling price Direct material 100 135 40 45 Direct labour 10 15 Overhead 20 30 50% of the overhead in SELANGOR and PAHANG are fixed. Required: (Each question is to be treated independently) a. Classify the cost incurred into variable cost per unit and total fixed cost for both states. (4 marks) b. Calculate the followings and show all your workings. i. The break-even point (in unit and sales value) for both states. i. The margin of safety (in unit) for both states. i. Advice to the management in which state should the company sell AFİ. (10 marks) e. Marketing manager suggested the company should sell AFI in both states as he is convinced the market would be good. However, the direct material cost will increase by 10%. Advice the management on how many additional units to be sold for both states, assuming other information remains unchanged and NUR Berhad would like to maintain its annual profit. (Calculate to the nearest unit).

Answer rating: 100% (QA)

Answer Step by Step Explanation A calculation of variable cost per unit and total fixed cost states ... View the full answer