(b) Calculate the break even point in units of the bird houses. Determine Sangkar Biru's margin of safety. in units. in percentage. (i) (ii) Compute : (i) The company's degree of operating leverage. (ii) The percentage of increase in income when sales increase by 20 percent.
(b) Calculate the break even point in units of the bird houses. Determine Sangkar Biru's margin of safety. in units. in percentage. (i) (ii) Compute : (i) The company's degree of operating leverage. (ii) The percentage of increase in income when sales increase by 20 percent.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
P ACC Q2 FULL
SUBJECT: PRINCIPLE OF ACCOUNTING
PLEASE ANSWER ASAP
![Q2
Sangkar Biru Sdn Bhd makes small bird houses that sells at RM32.00 each. The company's
level of production and sales is 145,000 units. The company has a pre-tax income of
RM1,620,450. In addition to RM530,500 of fixed manufacturing overhead and RM169,050
of fixed administrative expenses, the following per unit costs as in Table Q2 have been
determined for each bird house.
Table Q2: Cost Information for One Unit Bird House
(ii)
@
(b)
Cost Item
Direct material
Direct labour
(i)
(ii)
Variable manufacturing overhead
Variable selling expense
Total variable cost
Calculate the break even point in units of the bird houses.
Amount
(RM)
8.00
4.00
1.80
2.20
16.00
Determine Sangkar Biru's margin of safety.
in units.
in percentage.
Compute:
(i) The company's degree of operating leverage.
The percentage of increase in income when sales increase by 20 percent.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F0d0b7a91-5d3a-419b-80c1-970dc072b115%2Fe08042c9-4a6b-4625-b319-98169f49f896%2Ffptr6m2m_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Q2
Sangkar Biru Sdn Bhd makes small bird houses that sells at RM32.00 each. The company's
level of production and sales is 145,000 units. The company has a pre-tax income of
RM1,620,450. In addition to RM530,500 of fixed manufacturing overhead and RM169,050
of fixed administrative expenses, the following per unit costs as in Table Q2 have been
determined for each bird house.
Table Q2: Cost Information for One Unit Bird House
(ii)
@
(b)
Cost Item
Direct material
Direct labour
(i)
(ii)
Variable manufacturing overhead
Variable selling expense
Total variable cost
Calculate the break even point in units of the bird houses.
Amount
(RM)
8.00
4.00
1.80
2.20
16.00
Determine Sangkar Biru's margin of safety.
in units.
in percentage.
Compute:
(i) The company's degree of operating leverage.
The percentage of increase in income when sales increase by 20 percent.
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