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216 BEFT CO
This objective test case question contains question types which will only appear in a
computer?based exam, but this question provides valuable practice for all students
whichever version of the exam they are taking.
Beft Co makes house signs. Three different styles of sign are made and the following
unitary information is available:
Square Oval Clover Leaf
$ $ $
Materials:
– Metal @$1/kg 4.00 5.00 6.00
– Paint @ $4/L 2.00 3.00 4.00
Labour:
– Manufacturing @$4/hr 8.00 14.00 10.00
– Painting @$6/hr 3.00 9.00 12.00
Variable overheads 7.00 10.50 20.00
Fixed overheads 13.00 12.00 15.00
––––––– ––––––– –––––––
Profit 2.00 3.00 1.00
Selling price 39.00 56.50 68.00
Maximum monthly demand 4,000 4,500 1,800
Painting labour is limited to 7,250 hours for the next month while some of the workers are
away on a training course.3 Beft Co does not want to disappoint any customers next week and is considering subcontracting
out some painting, even if it results in a short term loss. The cost of
contracting out (which includes material costs and labour costs for painting) would
be:
Square Oval Clover Leaf
$ 7.00 15.00 22.00
A major customer, Z Co, who orders 500 of each type of plate each week insists that
their plates are painted in?house and not sub?contracted.
How many oval plates should be sent to the sub?contractors for painting?
_________ Oval plates
…
I didn’t understand how to calculate the no of plates…I can do till ranking..n I didn’t understand how they did it Kaplan500 of each plate have to be painted in house.
This will use up 2,000 hours of painting labour. The remaining 5,250 hours will be used according to the rankings.
The cost of contracting out per unit is Oval: $2, Clover: $3, and Leaf: $6
Therefore the cost per hour of contracting out the painting is Oval: $4, Clover: $2, and Leaf: $3.After making 500 of each in-house, there are 5,250 hours remaining. These hours will be used firstly to make Oval in house so they will make the remaining 3,500 Ovals in house, which uses up another 1,750 painting hours, which means there are now 3,500 hours remaining.
They use these hours to make the remaining 1,300 Leafs in-house which uses up another 2,600 painting hours.That means there are now 900 hours remaining. They will use these to make 600 Clovers inhouse. That means they are now making 1,100 Clovers in-house leaving 3,400 to be subcontracted.
Selling Peice : earting 600 nevaklace 1500 ring:1200
Total material cost :earring :100 necklace 500 ring:300
Maximum demand per annum earring 600 nevklace :450 Ring :1000
Chamakh Co makes 3 different kind of diamond jewellery earrings, necklace, and rings. Each item goes through a 3-step process.Step 1: A highly skilled Craftsman makes the settings.
Step 2: A diamond specialist selects, cuts and fits the stones to the settings. Step 3: An assistant polishes the item and packages it in presentation boxes.
Information related to these three items are shown below:
The material cost incurred by the Chamakh Co consists of the precious metals, diamonds and packaging. Chamakh Co employs three craftsmen, two diamond specialist and 2 assistants. Each Craftsman and diamond specialist earns $60,000 per annum and each assistant earn $25,000 per annum. The business is open for 8 hours per day for 5 days per week for 50 weeks of a year. Other business cost which are general overhead amount to be $100,000 per annum.
The time each step take per item is as follows:
Diamond earring :1.6 necklace 4 Ring 2
Craft man eaaring:2 necklace:4 Ring :2
Assistant earring :1 necklace :2 Ring :1.6Chamakh Co uses throughput accounting and has correctly identified the bottleneck activity as the diamond specialist hours.
What is the optimum number of necklace
Diamonnd processing is abhottleneck process
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