QUESTION 3 Mak Eton and Pak Abu, her husband, involves with a home-based catering since May 2020 due to Covid 19 outbreak. Mak Eton was well known as a good cooker. She loves cooking for family and friends since her young age. Previously her husband was a marketing manager for one of the travel agencies in Shah Alam. Due to movement control and the outbreak of the virus, the company retrenched half of the workers including Pak Abu. Pak Abu received retrenchment money amounted to RM24,000. Pak Abu used half of the money for their home-based catering, RM12,000 was used to buy cooking utensils for Mak Eton. They expect to generate income from this investment starting from May 2020 until April 2025. The business sells food in three packages; Package A: Nasi Kawen, Package B: Laksa Sedap or Pasta, and Package C: Nasi Campur Enak. All food will be packed nicely in a special container. Mak Eton cook only Package A and Package C, while Package B she bought from a neighbor, repack, and resell to customers. Below is the advertisement for all three packages Mak Eton Home-Based Catering: Cuba Sekali. NokLai Please whatason for order: 012-54489035 RM per Package Mandy & They MS kaper Friday Saturday Pak Abu helps deliver all the ordered food to customers daily using his old car. Due to heavy use, Pak Abu sent his car for services and maintenance every two months to make sure that his business operation is not interrupted. He incurred RM500 every time he send the car to the service center. Pak Abu also uses the car to the market daily in the morning. The monthly fuel incurred for both activities was RM300. Roadtax and insurance per annum amounted to RM720 Pak Abu charges customers delivery cost RM1 per set. Meanwhile, Miss Anesa, their youngest daughter helps them with tracking customer orders and money received before delivery of food. She will update the order and sales revenue to her mother daily. Mak Eton paid Miss Anesa a commission amounted RM1.50 per set. Mak Eton provides the following additional information relating to the business operations: For cooking food which is Package A and Package C, the raw materials are estimated at 20% of the selling price while indirect materials are 2% of the selling price. The cost of the special container is RM0.40 each for all packages The buying cost of Package B was RM5.60 per set (excluding special container cost) The wage paid to the cooking assistant was RM1,200 per month. They make an agreement verbally that the wage will not be paid if the business stop. Mak Eton and Pak Abu also take an allowance of RM1,500 per month per person for personal used. Required: a) Identify five (5) examples of irrelevant costs for decision making in a catering business (5 marks) b) On 25 December 2021, Miss Anesa received phone call from her ex-classmate, Miss Lina, who is planning for a wedding on 1st March 2022. Therefore she requested a quotation for 100 packs Package A, 50 packs Package Band 40 packs Package C. If Miss Lina satisfy with the quotation and agree to proceed with the order, Mak Eton plan to pay additional RM500 wages for cooking assistant. The business also will incur extra fuel cost of RM100 due to far location of the house. Determine minimum price that Mak Eton can charge for the above request. (12 marks) c) Since Mak Eton was a good cooker, Pak Abu suggested her wife cook Package B at home instead of buying ready food from her neighbor. The cost of materials for each set of Laksa Sedap or Pasta was RM2.50. Variable overhead absorption rate for Laksa Sedap or Pasta was RM0.50 per set. Mak Eton need to rent a set of cooking utensil at costs RM60 if she proceeds with her husband's suggestions. Discuss whether Mak Eton should proceed with her husband's suggestions. Support your answer with relevant calculation. (5 marks) (Total 22 marks) QUESTION 3 Mak Eton and Pak Abu, her husband, involves with a home-based catering since May 2020 due to Covid 19 outbreak. Mak Eton was well known as a good cooker. She loves cooking for family and friends since her young age. Previously her husband was a marketing manager for one of the travel agencies in Shah Alam. Due to movement control and the outbreak of the virus, the company retrenched half of the workers including Pak Abu. Pak Abu received retrenchment money amounted to RM24,000. Pak Abu used half of the money for their home-based catering, RM12,000 was used to buy cooking utensils for Mak Eton. They expect to generate income from this investment starting from May 2020 until April 2025. The business sells food in three packages; Package A: Nasi Kawen, Package B: Laksa Sedap or Pasta, and Package C: Nasi Campur Enak. All food will be packed nicely in a special container. Mak Eton cook only Package A and Package C, while Package B she bought from a neighbor, repack, and resell to customers. Below is the advertisement for all three packages Mak Eton Home-Based Catering: Cuba Sekali. NokLai Please whatason for order: 012-54489035 RM per Package Mandy & They MS kaper Friday Saturday Pak Abu helps deliver all the ordered food to customers daily using his old car. Due to heavy use, Pak Abu sent his car for services and maintenance every two months to make sure that his business operation is not interrupted. He incurred RM500 every time he send the car to the service center. Pak Abu also uses the car to the market daily in the morning. The monthly fuel incurred for both activities was RM300. Roadtax and insurance per annum amounted to RM720 Pak Abu charges customers delivery cost RM1 per set. Meanwhile, Miss Anesa, their youngest daughter helps them with tracking customer orders and money received before delivery of food. She will update the order and sales revenue to her mother daily. Mak Eton paid Miss Anesa a commission amounted RM1.50 per set. Mak Eton provides the following additional information relating to the business operations: For cooking food which is Package A and Package C, the raw materials are estimated at 20% of the selling price while indirect materials are 2% of the selling price. The cost of the special container is RM0.40 each for all packages The buying cost of Package B was RM5.60 per set (excluding special container cost) The wage paid to the cooking assistant was RM1,200 per month. They make an agreement verbally that the wage will not be paid if the business stop. Mak Eton and Pak Abu also take an allowance of RM1,500 per month per person for personal used. Required: a) Identify five (5) examples of irrelevant costs for decision making in a catering business (5 marks) b) On 25 December 2021, Miss Anesa received phone call from her ex-classmate, Miss Lina, who is planning for a wedding on 1st March 2022. Therefore she requested a quotation for 100 packs Package A, 50 packs Package Band 40 packs Package C. If Miss Lina satisfy with the quotation and agree to proceed with the order, Mak Eton plan to pay additional RM500 wages for cooking assistant. The business also will incur extra fuel cost of RM100 due to far location of the house. Determine minimum price that Mak Eton can charge for the above request. (12 marks) c) Since Mak Eton was a good cooker, Pak Abu suggested her wife cook Package B at home instead of buying ready food from her neighbor. The cost of materials for each set of Laksa Sedap or Pasta was RM2.50. Variable overhead absorption rate for Laksa Sedap or Pasta was RM0.50 per set. Mak Eton need to rent a set of cooking utensil at costs RM60 if she proceeds with her husband's suggestions. Discuss whether Mak Eton should proceed with her husband's suggestions. Support your answer with relevant calculation. (5 marks) (Total 22 marks)