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1. A chain of ABC plc, FAMA Beauty Ltd is a wholesale manufacturer of healthy foodstuffs. Because of a series of machine-related accidents at one of its factories, working practices have been revised and altered. It has resulted in a reduction in the number of labour hours available next period to 60.000. Four ready-made meals are produced in this factory and estimated data for the next accounting period are as follows: Product Maximum Demand 8,0 (units) 00 S1 S2 S3 $4 6,5 4,8 3,2 00 00 00 Selling and costing information (per unit) Selling price Direct materials Direct labours (Labour rate= 5/hr) Variable overhead Selling overhead OMR OMR 80 12 16 Co 8 4 OMR 110 30 20 10 4 OMR 145 35 15 14 4 OMR 170 40 20 16 4 The team wants to know about the limiting factor and requested you to help calculate the maximum profit which can be achieved in the period? They also asked to provide TWO alternatives FAMA Ltd must do to overcome the limiting factor?

1. A chain of ABC plc, FAMA Beauty Ltd is a wholesale manufacturer of healthy foodstuffs. Because of a series of machine-related accidents at one of its factories, working practices have been revised and altered. It has resulted in a reduction in the number of labour hours available next period to 60.000. Four ready-made meals are produced in this factory and estimated data for the next accounting period are as follows: Product Maximum Demand 8,0 (units) 00 S1 S2 S3 $4 6,5 4,8 3,2 00 00 00 Selling and costing information (per unit) Selling price Direct materials Direct labours (Labour rate= 5/hr) Variable overhead Selling overhead OMR OMR 80 12 16 Co 8 4 OMR 110 30 20 10 4 OMR 145 35 15 14 4 OMR 170 40 20 16 4 The team wants to know about the limiting factor and requested you to help calculate the maximum profit which can be achieved in the period? They also asked to provide TWO alternatives FAMA Ltd must do to overcome the limiting factor?

Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Chapter13: Emerging Topics In Managerial Accounting
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1. A chain of ABC plc, FAMA Beauty Ltd is a wholesale manufacturer of healthy foodstuffs. Because of a series of machine-related accidents at one of its factories, working practices have been revised and altered. It has resulted in a reduction in the number of labour hours available next period to 60,000. Four ready-made meals are produced in this factory and estimated data for the next accounting period are as follows: Product S1 S2 S3 S4 Maximum Demand 8,0 6,5 4,8 4,8 3,2 (units) 00 00 00 00 Selling and costing information (per unit) Selling price Direct materials Direct labours (Labour rate = 5/hr) Variable overhead Selling overhead OMR OMR OMR 80 110 12 26 16 100 8 4 30 20 10 4 OMR 145 35 15 14 4 OMR 170 40 20 16 4 The team wants to know about the limiting factor and requested you to help calculate the maximum profit which can be achieved in the period? They also asked to provide TWO alternatives FAMA Ltd must do to overcome the limiting factor?
Transcribed Image Text:1. A chain of ABC plc, FAMA Beauty Ltd is a wholesale manufacturer of healthy foodstuffs. Because of a series of machine-related accidents at one of its factories, working practices have been revised and altered. It has resulted in a reduction in the number of labour hours available next period to 60,000. Four ready-made meals are produced in this factory and estimated data for the next accounting period are as follows: Product S1 S2 S3 S4 Maximum Demand 8,0 6,5 4,8 4,8 3,2 (units) 00 00 00 00 Selling and costing information (per unit) Selling price Direct materials Direct labours (Labour rate = 5/hr) Variable overhead Selling overhead OMR OMR OMR 80 110 12 26 16 100 8 4 30 20 10 4 OMR 145 35 15 14 4 OMR 170 40 20 16 4 The team wants to know about the limiting factor and requested you to help calculate the maximum profit which can be achieved in the period? They also asked to provide TWO alternatives FAMA Ltd must do to overcome the limiting factor?
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