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A) The company's projected profit for the coming year is as follows: Total P 200,000' 120,000 80,000 64,000 16,000 Per Unit P 20 12 P 8 Sales Less: Variable Costs Contribution Margin P Less: Fixed Costs Net Income 1. Compute the additional profit that the company would earn if sales were P25,000 more than. expected.

A) The company's projected profit for the coming year is as follows: Total P 200,000' 120,000 80,000 64,000 16,000 Per Unit P 20 12 P 8 Sales Less: Variable Costs Contribution Margin P Less: Fixed Costs Net Income 1. Compute the additional profit that the company would earn if sales were P25,000 more than. expected.

FINANCIAL ACCOUNTING
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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Solve the following independent cases and label your supporting computations properly. A) The company's projected profit for the coming year is as follows: Total P 200,000' 120,000 80,000 64,000 16,000 Per Unit P 20 Sales Less: Variable Costs 12 P 8 Contribution Margin P Less: Fixed Costs Net Income 1. Compute the additional profit that the company would earn if sales were P25,000 more than expected. B) KTA sells a special type of health food at a price of P16 per pound. Last year, it purchases this food from its supplier at a cost of P12 per pound. The supplier informed KTA that its cost increases and that this product will now be priced at P14 a pound. Over the years, KTA established a steady market and intends to pass the cost increase along to its customers and also add a P1 per unit to the price for additional profit. Fixed cost for the year are not expected to change and will remain at P34,000. Income tax rate is 32%. The net income after tax last year was P24,000. 2. If KTA can maintain sales volume at the same level as before with the new price and cost structure, how much profit can it expect for next year? C) A company had a loss of P3 per unit when sales were 40,000 units. When sales were 50,000 units, the company had a loss of P1.60 per unit. 3. Determine the BEP in units.
Transcribed Image Text:Solve the following independent cases and label your supporting computations properly. A) The company's projected profit for the coming year is as follows: Total P 200,000' 120,000 80,000 64,000 16,000 Per Unit P 20 Sales Less: Variable Costs 12 P 8 Contribution Margin P Less: Fixed Costs Net Income 1. Compute the additional profit that the company would earn if sales were P25,000 more than expected. B) KTA sells a special type of health food at a price of P16 per pound. Last year, it purchases this food from its supplier at a cost of P12 per pound. The supplier informed KTA that its cost increases and that this product will now be priced at P14 a pound. Over the years, KTA established a steady market and intends to pass the cost increase along to its customers and also add a P1 per unit to the price for additional profit. Fixed cost for the year are not expected to change and will remain at P34,000. Income tax rate is 32%. The net income after tax last year was P24,000. 2. If KTA can maintain sales volume at the same level as before with the new price and cost structure, how much profit can it expect for next year? C) A company had a loss of P3 per unit when sales were 40,000 units. When sales were 50,000 units, the company had a loss of P1.60 per unit. 3. Determine the BEP in units.
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