Ddk,
Autor: Aman Pachisia • November 30, 2016 • Coursework • 774 Words (4 Pages) • 634 Views
COMA Assignment
Answer 1
|
| Product X | Product Y | Product Z |
| Sale value per unit | 295 | 390 | 340 |
less | Direct material | 75 | 120 | 90 |
less | Direct labour @ Rs.20 per labour hour | 80 | 100 | 110 |
less | Variable overheads | 40 | 70 | 60 |
| CONTRIBUTION | 100 | 100 | 80 |
(Assumption: 50% of the total amount of Material is imported i.e the cost of imported and domestic raw materials would be same.)
When imported material is the key/limiting factor,
Calculation of Contribution per KG of imported Raw Materials | |||
| Product X | Product Y | Product Z |
Direct Imported material(Rs.) | 50% of 75 | 50% of 120 | 50% of 90 |
37.5 | 60 | 45 | |
Cost of Imported Raw material per kg(Rs.) | 5 | 5 | 5 |
Imported Raw material requiremnt(kg) | 7.5 | 12 | 9 |
CONTRIBUTION | 100 | 100 | 80 |
Contribution per kg(Rs.) | 13.33 | 8.33 | 8.89 |
It is clear that the firm enjoys greater contribution margin per kg use of Imported Raw material in case of product X than product Y & Z.
When Capacity is the key/limiting factor,
Calulation of Contribution per Labour Hour(Capacity) | |||
| Product X | Product Y | Product Z |
CONTRIBUTION | 100 | 100 | 80 |
No of Labour Hours per Unit | 80/20 | 100/20 | 110/20 |
4 | 5 | 5.5 | |
Contribution per labour hour(Rs.) | 25 | 20 | 14.55 |
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