Amazon limited sells a product whose data for two quarters is as follows: Quarter One Two Sales revenue (Ksh) Variable costs (Ksh) Profit (Ksh) 100,000 60,000 20,000 150,000 90,000 40,000 Unit price, unit variable cost and fixed costs remained constant during the two quarters. Required: i) Determine the fixed costs and the contribution margin ratio i) Determine the breakeven sales revenue iii) Compute the profit if goods worth Ksh 500,000 were sold iv) Determine the sales revenue for a target profit of Ksh 120,000
Amazon limited sells a product whose data for two quarters is as follows: Quarter One Two Sales revenue (Ksh) Variable costs (Ksh) Profit (Ksh) 100,000 60,000 20,000 150,000 90,000 40,000 Unit price, unit variable cost and fixed costs remained constant during the two quarters. Required: i) Determine the fixed costs and the contribution margin ratio i) Determine the breakeven sales revenue iii) Compute the profit if goods worth Ksh 500,000 were sold iv) Determine the sales revenue for a target profit of Ksh 120,000
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 23E: Variable cost method of product pricing Based on the data presented in Exercise 17, assume that...
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![Amazon limited sells a product whose data for two quarters
is as follows:
Quarter
One
Two
Sales revenue (Ksh) Variable costs (Ksh) Profit (Ksh)
100,000
60,000
20,000
150,000
90,000
40,000
Unit price, unit variable cost and fixed costs remained constant
during the two quarters.
Required:
i) Determine the fixed costs and the contribution margin ratio
ii) Determine the breakeven sales revenue
iii) Compute the profit if goods worth Ksh 500,000 were sold
iv) Determine the sales revenue for a target profit of Ksh 120,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F70b9b44a-18b6-45fd-80c7-7ba6a86eadcc%2F0f9af570-cb5c-4419-9a8b-a46275f94429%2F3q7qhzu_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Amazon limited sells a product whose data for two quarters
is as follows:
Quarter
One
Two
Sales revenue (Ksh) Variable costs (Ksh) Profit (Ksh)
100,000
60,000
20,000
150,000
90,000
40,000
Unit price, unit variable cost and fixed costs remained constant
during the two quarters.
Required:
i) Determine the fixed costs and the contribution margin ratio
ii) Determine the breakeven sales revenue
iii) Compute the profit if goods worth Ksh 500,000 were sold
iv) Determine the sales revenue for a target profit of Ksh 120,000
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