Class activitiesBlossom Flower Sdn Bhd is a manufacturing company producing artificial flowers.Currently, the company makes two types of flower petals namely Rose and Lily.The budgeted production costs per annum in making the petals are as follows:RoseLily20,00030,00050,000100,000Direct material (RM)Direct labour (RM)Overheads (RM)TOTAL COST (RM)Production (units)60,00040,00060,000160,000100,000Rose RM20,00040,000All direct labours are paid at RM10 per hour. Total budgeted fixed productionoverheads are RM54,000 and variable overheads are absorbed based on directlabour hour.Outside supplier has offered flower petals of Rose and Lily at purchase price ofRM0.50 per unit each. The following information should be considered if themanagement decides to purchase instead of manufacture the petals.i. The company needs to bear the cost of transportation charges and qualitychecking of RM0. 10 per unit and RM1.00 per unit respectively.ii. Fixed overhead costs will be reduced by the amount as follows:

Lets understand the basics.When management have option either to product goods or purchase from…

Class activities Blossom Flower Sdn Bhd is a manufacturing company producing artificial flowers Currently, the company makes two types of flower petals namely Rose and Lily. The budgeted production costs per annum in making the petals are as follows: Rose Lily Direct material (RM) Direct labour (RM) Overheads (RM) TOTAL COST (RM) Production (units) 60,000 40,000 60,000 160,000 100,000 20,000 30,000 50,000 100,000 40,000 All direct labours are paid at RM10 per hour. Total budgeted fixed produc overheads are RM54,000 and variable overheads are absorbed based on di labour hour. Outside supplier has offered flower petals of Rose and Lily at purchase price RM0.50 per unit each. The following information should be considered if management decides to purchase instead of manufacture the petals.

Class activities Blossom Flower Sdn Bhd is a manufacturing company producing artificial flowers Currently, the company makes two types of flower petals namely Rose and Lily. The budgeted production costs per annum in making the petals are as follows: Rose Lily Direct material (RM) Direct labour (RM) Overheads (RM) TOTAL COST (RM) Production (units) 60,000 40,000 60,000 160,000 100,000 20,000 30,000 50,000 100,000 40,000 All direct labours are paid at RM10 per hour. Total budgeted fixed produc overheads are RM54,000 and variable overheads are absorbed based on di labour hour. Outside supplier has offered flower petals of Rose and Lily at purchase price RM0.50 per unit each. The following information should be considered if management decides to purchase instead of manufacture the petals.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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