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3)

DM INCREASE 105% 16 20 22

16.8 21 23.1

SP INCREASED TO 86.8 88 106.1

INCOME STATEMENT IN APRIL

7600 12000 4200

X 86.8 X 88 X 106.1

7)

THE PRODUCT TO CHANGE WOULD BE FLOW CONTROLLER AS IT IS LESS COMPETITIVE

8)

OVEHREADS CANNOT BE ALLOCATED ON DM AS IT HAS NO RELEVANCE ON PRODUCTION RUNS. IT

HAS TO BE CONNECTED OR LINKED TO THE RUNS IN FACTORY

10)

IT RELEALS THAT ABC IS MORE ACCURATE

11) SUGGEST ABC TO BE MORE REALSITIC

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9. ABC METHOD ( $) VALVES PUMPS F/CON $
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9.   ABC METHOD ( $) VALVES PUMPS F/CON $

MACHINE RELATED 112500 187500 36000 336000

SET UP LABOUR 2500 12500 25000 40000

REC/ PROD 56250 93750 30000 180000

ENGINEERING 20000 30000 50000 100000

PACKAGINH SHIPP 5000 35000 110000 150000

SUB TOTAL 196250 358750 251000 806000

NO OF UNITS 7500 12500 4000

PER UNIT $26.17 $28.70 $62.75

CON MARGIN STATEMENT MAR 2016 VALVES PUMPS F/CONTL TOTAL

UNITS 7500 12500 4000

SP                      86 87 105

TOTAL 645000 1087500 420000 2152500

MARGIN 225105 212063 172200 609368

DL 75000 156250 40000

DM 12000 250000 88000

MACHINE RELATED 80% VC 84000 140000 44800 268800

RECEIVING 90% VC 56250 93750 30000 162000

PACKING 50% VC 23438 39063 12500 75000

GEN ADMIN 10% 17490 29148 9328 55965

CONTRIBUTION 376822 378289 195372 950483

MACH RELATED FIXED 20% 67200

SET UP 100% FIXED 40000

RECEIVING 10% 18000

ENGINERRING 100% 100000

PACKING 50% 75000

GEN ADMIN 90% 503685

TOTAL OHS 803885

NET INCOME 146598

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