Three products X, Y and Z are made and sold by a company. The relevant information is given as follows:
|
Products |
X |
Y |
Z |
|
|
Standard Costs per unit |
||||
|
Direct Materials (Rs.) |
50 |
120 |
90 |
|
|
Variable Overheads (Rs.) |
12 |
7 |
16 |
|
|
Direct Labour |
Rate per hour |
Hrs |
Hrs |
Firs |
|
Department A |
Rs. 5 |
14 |
8 |
15 |
|
Department 8 |
Rs. 6 |
4 |
3 |
5 |
|
Department C |
Rs. 4 |
8 |
4 |
15 |
Total fixed overheads for the year are Rs. 3,00,000. The budget for the current financial year, which is prepared for a recessionary period, is based on the following sales:
|
Products |
Sales (Units) |
Selling Price per Unit (Rs.) |
|
X |
7,500 |
210 |
|
Y |
6,000 |
220 |
|
Z |
6,000 |
300 |
You are required to show in the form of a statement to the management, the unit Variable Cost of the three products and the total profit expected for the current year. Which of these products is the most profitable? Rank the products.