Pinches Ltd makes cooking oil which sells at £20 a bottle. Variable costs are £12 a bottle. The business is working at full capacity. What is the minimum price at which this product could be sold without making a loss for an order of 12,000 bottles? To fulfil this additional order, the company would incur additional fixed costs of £50,000 and variable costs of £70,000. You may assume a linear relationship between costs and selling price. Select one answer: O£120,000 £216,000 O£96,000 O£240,000
Pinches Ltd makes cooking oil which sells at £20 a bottle. Variable costs are £12 a bottle. The business is working at full capacity. What is the minimum price at which this product could be sold without making a loss for an order of 12,000 bottles? To fulfil this additional order, the company would incur additional fixed costs of £50,000 and variable costs of £70,000. You may assume a linear relationship between costs and selling price. Select one answer: O£120,000 £216,000 O£96,000 O£240,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Pinches Ltd makes cooking oil which sells at £20 a bottle. Variable costs are £12 a bottle. The business is working
at full capacity. What is the minimum price at which this product could be sold without making a loss for an order
of 12,000 bottles? To fulfil this additional order, the company would incur additional fixed costs of £50,000 and
variable costs of £70,000. You may assume a linear relationship between costs and selling price
Select one answer:
O£120.000
£216,000
O£96,000
O£240,000
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