Calculate: a) The break-even level of production and sales b) The margin of safety

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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1) CAPRICORN SA manufactures office desks. The following
information relates to the costs and revenues associated with
the production of 10,000 desks:
Per Desk
€
Direct Materials (DM) 3
Direct Labour (DL) 18.
Semi-variable Costs (SVC) 9
Fixed Costs (FC) 4
Profit
26
Selling Price
60
Calculate:
a) The break-even level of production and sales
b) The margin of safety
Transcribed Image Text:1) CAPRICORN SA manufactures office desks. The following information relates to the costs and revenues associated with the production of 10,000 desks: Per Desk € Direct Materials (DM) 3 Direct Labour (DL) 18. Semi-variable Costs (SVC) 9 Fixed Costs (FC) 4 Profit 26 Selling Price 60 Calculate: a) The break-even level of production and sales b) The margin of safety
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