leadership and management materials with questions

Case Study – Shower Screens

John works for a company that manufacturers shower screens. He is the Cost Centre Manager for the production area. For the four products they manufacture, sales at the end of February are in the table below:

Product	Unit	Value ($)
Basic	150	37,500 (250 per unit)
Standard Plus	250	125,000 (500 per unit)
Deluxe	200	150,000 (750 per unit)
Super Deluxe	100	100,000 (1,000 per unit)

The above production is standard from month to month and the costs involved are below:

Product	Labour per unit (hours)	Material cost per unit ($)	Overhead contribution per unit ($)
Basic	2.0	100	10
Standard Plus	3.0	250	20
Deluxe	4.0	480	34
Super Deluxe	5.0	600	43

Labour is costed at $50 per hour and includes contributions to leave entitlements and superannuation. Material costs are fixed with a supply contract for the standard quantities required each month.

John is advised that the company is just one extra order for the supply of shower screens for a refit of a hotel, and the products are required by the end of March. The quantities and the agreed price per unit are below.

Product	Required units	Price agreed per unit ($)
Basic	30	275
Standard Plus	50	550
Deluxe	10	750
Super Deluxe	5	900