Limited has examined the use of a new product which is assumed to improve profitability. You are required to analyse Bella the following data in order to assist Bella Limited decide on whether or not the new project is in fact viable. INFORMATION The data provided is based on expected sales of 15000 units with a selling price per unit of R810. The costs associated with this project includes the following: Direct materials cost (R2 700 000), Direct labour cost (R1 800 000), Variable overhead costs (765 000), Fixed manufacturing overhead costs (R702000) and Fixed administrative and selling costs (R167400). In addition, selling commission per unit sold is 10%. REQUIRED Study the information provided below and answer each of the following questions independently: 1.1 Calculate the sales quantity and sales value required to break even.

Limited has examined the use of a new product which is assumed to improve profitability. You are required to analyse Bella the following data in order to assist Bella Limited decide on whether or not the new project is in fact viable. INFORMATION The data provided is based on expected sales of 15000 units with a selling price per unit of R810. The costs associated with this project includes the following: Direct materials cost (R2 700 000), Direct labour cost (R1 800 000), Variable overhead costs (765 000), Fixed manufacturing overhead costs (R702000) and Fixed administrative and selling costs (R167400). In addition, selling commission per unit sold is 10%. REQUIRED Study the information provided below and answer each of the following questions independently: 1.1 Calculate the sales quantity and sales value required to break even.

Essentials of Business Analytics (MindTap Course List)

2nd Edition

ISBN:9781305627734

Author:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Publisher:Jeffrey D. Camm, James J. Cochran, Michael J. Fry, Jeffrey W. Ohlmann, David R. Anderson

Chapter15: Decision Analysis

Section: Chapter Questions

Problem 5P: Hudson Corporation is considering three options for managing its data warehouse: continuing with its...

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