Question #317663
Sonja Cc is a small firm that make outfits for customers tailored for their functions, in May 2021 she was order for a baby shower (BS).
The details Job for BS are as follows:
Direct materials: 120 units at N124
Direct labour: 20 hours for department A at N$25 per hour.
10 hours for department B at N30 per hour
12 hour s for department C at N$27.50
The firm allocates manufacturing overheads budgeted at N$2500 in department A, N$2000 in department B and N$3000 in department C.
The firm expects a profit of 55% on the total cost of BS.
Required:
a)Calculate the cost of a baby shower (BS)
b)Calculate the selling price of a baby shower (BS)
c)If the number of outfits are the same for each type of function, which function should Sonja choose to produce and why?
Expert's answer
choose the function with the highest profit and lowest cost
