Z Limited manufactures three products, the selling price and cost details of which are given below:
|
Product |
Product |
Product |
|
|
X |
Y |
Z |
|
|
(£) |
(£) |
(£) |
|
|
Selling price per unit |
75 |
95 |
95 |
|
Costs per unit: |
|||
|
Direct materials |
10 |
5 |
15 |
|
(£5 /kg) |
|||
|
Direct labour |
16 |
24 |
20 |
|
(£4/hour) |
|||
|
Variable overhead |
8 |
12 |
10 |
|
Fixed overhead |
24 |
36 |
30 |
In a period when direct materials are restricted in supply, the most and the least profitable uses of direct materials are
|
Most profitable |
Least profitable |
|
|
A |
X |
Z |
|
B |
Y |
Z |
|
C |
X |
Y |
|
D |
Z |
Y |
|
E |
Y |
X |