CONT DE ON NEXT PAG QUESTION 4 Nano Ltd. manufactures three different types of electric kits for push bike: X, Y and Z. It was expected that the production and demand for the next year on these products as follows: Product X Product Y Product Z Units 1800 2700 3600 Additional details about the products are also as follows: Each unit Product X Product Y Product Z £ £ £ Selling price 418 816 744 Materials 77 192 144 Labour 96 230 192 Variable overheads 58 144 115 Nano Ltd. pays labour £9.6 an hour and expects its fixed overheads to be £576,000. Required: a) Calculate the production plan that will maximise profit for Nano Ltd. for next year given that Nano Ltd. has only managed to contract 108,000 labour hours for next year. b) Calculate Nano Ltd.'s profit based on the production plan in a). Page 8 of 11 c) It was found that Nano Ltd. has already committed to a contract legally obligating it to supply 2520 units of Product Y. Recalculate the production plan that will maximise profit according to this newly factor.

CONT DE ON NEXT PAG QUESTION 4 Nano Ltd. manufactures three different types of electric kits for push bike: X, Y and Z. It was expected that the production and demand for the next year on these products as follows: Product X Product Y Product Z Units 1800 2700 3600 Additional details about the products are also as follows: Each unit Product X Product Y Product Z £ £ £ Selling price 418 816 744 Materials 77 192 144 Labour 96 230 192 Variable overheads 58 144 115 Nano Ltd. pays labour £9.6 an hour and expects its fixed overheads to be £576,000. Required: a) Calculate the production plan that will maximise profit for Nano Ltd. for next year given that Nano Ltd. has only managed to contract 108,000 labour hours for next year. b) Calculate Nano Ltd.'s profit based on the production plan in a). Page 8 of 11 c) It was found that Nano Ltd. has already committed to a contract legally obligating it to supply 2520 units of Product Y. Recalculate the production plan that will maximise profit according to this newly factor.

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

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 41E

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