7 - weekly submissions , week 5 PDF

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BFA612

UNIVERSITY OF TASMANIA Management and Cost Accounting BFA612 SUBMISSION WEEK 5 Student Id: 470531 Question no 7.31 Chapter 7 Answer 1. Total cost of G16 Direct material cost = $14.98 Direct Labor cost = $15.00 p.hr *0.5 = $7.50 Testing Cost = $12 p.hr* 0.25=$3.00 Calculation of full cost/ unit and to produce 50000 unit 1. Computation of full cost/Unit and to produce 50000 Unit

Direct Material Direct Manufacturing Labor Testing Engineering Full Cost

Per unit Total cost for Cost 50000 unit $14.98 $749,000.00 $7.50 $3.00

$375,000.00 $150,000.00

$7.00 $32.48

$350,000.00 $1,624,000.00

Total cost of G16 = $1,624,000.00 Answer 2: Markup percentage on the full cost per unit selling price = $40.60 cost = $35.48 Mark-up = $40.60 - $35.48 = $5.12 Markup on full cost per unit = 14.43 Answer 3. Revenue from 10,000 units = 40.60 * 10000 = $40,600 Incremental material cost = $14.98 * 1000 = $1,49,800

2 BFA612 Direct Labor = 15*0.5*10000 = 75,000 Inc Engineering cost = Nil Inc Testing cost = 12**0.25*10000 = $30,000 Additional cost of marketing =$200,000 Inc. Profit or Loss = $-4,88,00 So, this is not Advisable to use marketing to boost the sales. Answer 4: If systematic Ltd spends an extra $200,000 on marketing keeping the same mark-up percentage Total Cost = 22.48+6*50000+20000 = $1,624,000 Cost per unit = $1,624,000/60000 =$ 24.07 Selling Price = $27.07*114.43 % = $30.98 So, after extra spending the new selling price will be $30.98 per unit of G16...