Question: Question 4 ( 10 mar ABC Lid has provided the following data relating to its two most popular models of an electronic product Standard Deluxe

Question 4 ( 10 mar ABC Lid has provided the following data relating to its two most popular models of an electronic product Standard Deluxe Sunit Selling price 120 Direct material Direct labour Manufact uring overhead @ $30 machine hour Monthly demand ( units ) 40 090 2400 The fixed manufacturing overhead component included in the above unit costs is $20 per machine hour On the very first day of June a major piece of manufacturing equipment was damaged It would take two weeks for replacement parts to arrive from Switzerland Consequently , there would be only 60 090 machine hours available in June to manufacture the two models of the electronic product . Required ( a ) Given the limited machine hours available in June , conduct an appropriate financial analysis . ( 6 marks ) ( 6 ) Based on the above financial analysis , determine how many units of each product should be produced in that month to maximise ABC Lid's profitability . ( 4 marks )
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
