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In this summative assessment, you will be required to do product costing and analyse variances.
Moda Products manufacture and distribute body care products to major retail outlets. They use both local and imported ingredients for their products. Mainly, the packing materials, i.e. bottles, caps, jars, applicators etc are imported and filled locally with locally made ingredients.
To fulfil their Christmas commitment, they have decided to produce 18,000 units of a special body lotion. The planned materials costs are divided at 43% for packaging (imported goods) and 57% for filling (local goods). The imported goods add roughly 12% to the product cost in freight, handling and exchange rate. Other overheads are projected as;
Manufacturing/labour: Packaging: Storage/Transportation: Admin overheads: Marketing Overheads: Pilferage/Damage:
$0.12 per unit
$0.04 per unit
$0.06 per unit
$0.10 per unit
$0.08 per unit
2% of the total volume
Fixed Fixed Variable Variable Variable
Company wants a mark up of 35% on its total product cost ex GST, which will be its wholesale price to the retailers.
Using the above data, prepare and compute in an Excel sheet using different tabs of the sheet for each one of the following calculations;
Part A:
Assessment Criteria:
The trainee will be assessed on the following criteria for this assessment task;
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