1
476 Points
Joined June 2014
Regarding Part (iii) of Q.9 when i solved the sum by substituting the Cost of
Warehouse 'C' to Market 'II' as Rs. 3 p.u.
and thereafter performing VAM Operation from the begining , i got a different answer from that given in the Practice manual.
i.e. if we perform VAM Operation from the begining by taking p.u. cost as Rs.3
then No allocation is made for >> 'C' to 'II' bcoz the cost p.u. of 'A' to 'II' is Rs.2 (which is Lesser than Cost of Rs.3)
So entire allocation will be made to 'A' only again
So , i feel the Answer should have been that 'C' must reduce its cost p.u. to Rs.2 for Market 'II' so that it will get Allocation
(This is what is given in PadhukaTextBook (Q.4 Pg.17.9 of Nov,12 Edition)
Plz reply which is right
A)Rs.3
or B)Rs.2