(a) Fragrant Company produces young adult perfumes needs to determine if it would be cheaper to produce 100,000 bottles of its most popular perfume, Timmee, for sale in its college town shops or to purchase them from an outside supplier for RM25 each. Cost information on internal production includes the following: [Syarikat Fragrant menghasilkan minyak wangi dewasa muda perlu menentukan jika ia akan menjadi lebih murah menghasilkan 100,000 botol minyak wangi mereka yang paling terkenal, Timmee, untuk dijual di kedai-kedai bandar kolejnya atau membelinya daripada pembekal luar untuk RM25 setiap satu. Maklumat kos pengeluaran dalaman termasuk yang berikut:] Table 6: Production Costs [Jadual 6: Kos-kos Pengeluaran] Total Cost Unit Cost RM RM Direct materials Direct labor Variable manufacturing overhead Variable marketing overhead Fixed plant overhead 2,000,000 350,000 20.00 3.50 1.50 150,000 250,000 300,000 2.50 3.00 Total 3,050,000 30.50 Fixed overhead will continue whether Timmee is produced internally or externally. No additional costs of purchasing will be incurred beyond the purchase price. [Overhed tetap akan berterusan sama ada Timmee dihasilkan secara dalaman atau luaran. Tiada kos- kos tambahan pembeliaan yang akan ditanggung melebihi harga belian.) Required: [Dikehendaki:/ (i) List the alternatives for Fragrant Company. (Senaraikan alternatif untuk Syarikat Fragrant.] (ii) List the relevant costs(s) of internal production and of external purchase. [Senaraikan kos-kos relevan pengeluaran dalaman dan pembelian luaran.] (iii) Propose an alternative that is more cost-effective decision with calculation details. [Cadangkan alternatif yang keputusannya lebih kos efektif dengan perincian pengiraan.)
(a) Fragrant Company produces young adult perfumes needs to determine if it would be cheaper to produce 100,000 bottles of its most popular perfume, Timmee, for sale in its college town shops or to purchase them from an outside supplier for RM25 each. Cost information on internal production includes the following: [Syarikat Fragrant menghasilkan minyak wangi dewasa muda perlu menentukan jika ia akan menjadi lebih murah menghasilkan 100,000 botol minyak wangi mereka yang paling terkenal, Timmee, untuk dijual di kedai-kedai bandar kolejnya atau membelinya daripada pembekal luar untuk RM25 setiap satu. Maklumat kos pengeluaran dalaman termasuk yang berikut:] Table 6: Production Costs [Jadual 6: Kos-kos Pengeluaran] Total Cost Unit Cost RM RM Direct materials Direct labor Variable manufacturing overhead Variable marketing overhead Fixed plant overhead 2,000,000 350,000 20.00 3.50 1.50 150,000 250,000 300,000 2.50 3.00 Total 3,050,000 30.50 Fixed overhead will continue whether Timmee is produced internally or externally. No additional costs of purchasing will be incurred beyond the purchase price. [Overhed tetap akan berterusan sama ada Timmee dihasilkan secara dalaman atau luaran. Tiada kos- kos tambahan pembeliaan yang akan ditanggung melebihi harga belian.) Required: [Dikehendaki:/ (i) List the alternatives for Fragrant Company. (Senaraikan alternatif untuk Syarikat Fragrant.] (ii) List the relevant costs(s) of internal production and of external purchase. [Senaraikan kos-kos relevan pengeluaran dalaman dan pembelian luaran.] (iii) Propose an alternative that is more cost-effective decision with calculation details. [Cadangkan alternatif yang keputusannya lebih kos efektif dengan perincian pengiraan.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![(a) Fragrant Company produces young adult perfumes needs to determine if it would be
cheaper to produce 100,000 bottles of its most popular perfume, Timmee, for sale in its
college town shops or to purchase them from an outside supplier for RM25 each. Cost
information on internal production includes the following:
[Syarikat Fragrant menghasilkan minyak wangi dewasa muda perlu menentukan jika ia akan menjadi
lebih murah menghasilkan 100,000 botol minyak wangi mereka yang paling terkenal, Timmee, untuk
dijual di kedai-kedai bandar kolejnya atau membelinya daripada pembekal luar untuk RM25 setiap satu.
Maklumat kos pengeluaran dalaman termasuk yang berikut:]
Table 6: Production Costs
[Jadual 6: Kos-kos Pengeluaran]
Total Cost
Unit Cost
RM
2,000,000
RM
Direct materials
Direct labor
Variable manufacturing overhead
Variable marketing overhead
20.00
3.50
350,000
150,000
250,000
300,000
3,050,000
1.50
2.50
3.00
Fixed plant overhead
Total
30.50
Fixed overhead will continue whether Timmee is produced internally or externally. No
additional costs of purchasing will be incurred beyond the purchase price.
(Overhed tetap akan berterusan sama ada Timmee dihasilkan secara dalaman atau luaran. Tiada kos -
kos tambahan pembeliaan yang akan ditanggung melebihi harga belian.]
Required:
[Dikehendaki:/
(i) List the alternatives for Fragrant Company.
[Senaraikan alternatif untuk Syarikat Fragrant.]
(ii) List the relevant costs(s) of internal production and of external purchase.
[Senaraikan kos-kos relevan pengeluaran dalaman dan pembelian luaran.j
(iii) Propose an alternative that is more cost-effective decision with calculation details.
[Cadangkan alternatif yang keputusannya lebih kos efektif dengan perincian pengiraan.)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1c826206-9bfb-4235-8cd3-ad5d75d7ab81%2F33739641-1ba1-4f1f-9991-ae832e8a3747%2F4igsy3i_processed.jpeg&w=3840&q=75)
Transcribed Image Text:(a) Fragrant Company produces young adult perfumes needs to determine if it would be
cheaper to produce 100,000 bottles of its most popular perfume, Timmee, for sale in its
college town shops or to purchase them from an outside supplier for RM25 each. Cost
information on internal production includes the following:
[Syarikat Fragrant menghasilkan minyak wangi dewasa muda perlu menentukan jika ia akan menjadi
lebih murah menghasilkan 100,000 botol minyak wangi mereka yang paling terkenal, Timmee, untuk
dijual di kedai-kedai bandar kolejnya atau membelinya daripada pembekal luar untuk RM25 setiap satu.
Maklumat kos pengeluaran dalaman termasuk yang berikut:]
Table 6: Production Costs
[Jadual 6: Kos-kos Pengeluaran]
Total Cost
Unit Cost
RM
2,000,000
RM
Direct materials
Direct labor
Variable manufacturing overhead
Variable marketing overhead
20.00
3.50
350,000
150,000
250,000
300,000
3,050,000
1.50
2.50
3.00
Fixed plant overhead
Total
30.50
Fixed overhead will continue whether Timmee is produced internally or externally. No
additional costs of purchasing will be incurred beyond the purchase price.
(Overhed tetap akan berterusan sama ada Timmee dihasilkan secara dalaman atau luaran. Tiada kos -
kos tambahan pembeliaan yang akan ditanggung melebihi harga belian.]
Required:
[Dikehendaki:/
(i) List the alternatives for Fragrant Company.
[Senaraikan alternatif untuk Syarikat Fragrant.]
(ii) List the relevant costs(s) of internal production and of external purchase.
[Senaraikan kos-kos relevan pengeluaran dalaman dan pembelian luaran.j
(iii) Propose an alternative that is more cost-effective decision with calculation details.
[Cadangkan alternatif yang keputusannya lebih kos efektif dengan perincian pengiraan.)
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