Revenue and cost details for a company’s single product are as follows: BWP per unit BWP per unit Sales price 27 Variable cost 15 Fixed cost 8 (23) Profit 4 Fixed costs are absorbed based on the company’s normal activity, which is also the company’s budgeted sales value for each period. Last period there were no changes in inventory and the company achieved a margin of safety of 20% of the actual sales volume. Fixed costs were over-absorbed by P2,400. Required: a. Calculate the breakeven point in units for each period.
Revenue and cost details for a company’s single product are as follows:
BWP per unit BWP per unit
Sales price 27
Variable cost 15
Fixed cost 8
(23)
Profit 4
Fixed costs are absorbed based on the company’s normal activity, which is also the
company’s budgeted sales value for each period. Last period there were no changes in
inventory and the company achieved a margin of safety of 20% of the actual sales volume.
Fixed costs were over-absorbed by P2,400.
Required:
a. Calculate the breakeven point in units for each period.
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Solved in 3 steps
calculate the number of units to be produced and sold to achieve a profit of P6 600 for the period
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