NO. 4 Cash Break-even The production data and other related information of ROLLY Processing Company are presented as follows: Selling price per unit Number of units produced and sold monthly Monthly fixed cash payments P45.00 1,000,000 P2,925,000 For the past years, ROLLY Processing Company has experiencėd a variable monthly cash payment of 45% of sales. Required; Compute the following: 4. Cash contribution ratio 5. Cash contribution margin ratio 6. Cash break-even
NO. 4 Cash Break-even The production data and other related information of ROLLY Processing Company are presented as follows: Selling price per unit Number of units produced and sold monthly Monthly fixed cash payments P45.00 1,000,000 P2,925,000 For the past years, ROLLY Processing Company has experiencėd a variable monthly cash payment of 45% of sales. Required; Compute the following: 4. Cash contribution ratio 5. Cash contribution margin ratio 6. Cash break-even
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Please answer the first picture, the second picture is the example.
Transcribed Image Text:NO. 4 Cash Break -even
The production data and other related information of ROLLY Processing Company are presented as follows:
Selling price per unit
Number of units produced and sold monthly
Monthly fixed cash payments
P45.00
1,000,000
P2,925,000
For the past years, ROLLY Processing Company has experiencėd a variable monthly cash payment of 45% of sales.
Required; Compute the following:
4. Cash contribution ratio
5. Čash contribution margin ratio
6. Çash break-even
Transcribed Image Text:TASK 2
A.Cash Break-even
Selling price per unit
P 25.00
Number
of
units produced and sold monthly
800,000 units
Monthly fixed cach payments
P2,640,000
Variable month ly cash payments
45% of rales
step I.Cash contribution ratio
Cash sales
200,000, 000 -00
Less : Variable cash payments
9,000,000 - DO
Cash contribution ratio
11,000,00.00
step 2. cash contribution margin ratio
Cash confributi on ratio
11,000,000-00
pìvided by: Cash sales
20,000 ,000 00
Cash contribution margin ratio
55 %-
Step 3. Cash Break-even point
Fixed cash outlay
2,640,000 00
pivided by: contribution margin rantio
557
Cash Break -even
4,800,000.00
- Rolly has to make cash cales of 192,000 units of the product to generate cash of
P4,800,000. 00.
Cash Break-even sales
4,800,000.00
Divi ded by: Selling price per unit
25.00
Number of unit to sell on cash
192,000. 00
- To prove that 4,800,000.60 is the cash break-even point the computation appears as
fotlows: Cash Break-even point
41,800,000.00
Less : Variable cash payments l(4,800,000x 457)
contribution margin
2, 140,000 -00
2,640, 000.06
Less : #ixed monthly cash poyment
2,640.000.00
A vailable cash
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