Question 1: A company produces and sells two products with the following costs: Product X Product Y Variable costs per Br. of sales Fixed costs per period Br.0.45 Br.1 212 000 Br.0.6 Br.1 212 000 Total sales revenue is currently generated by the two products in the following proportions: Product X 70% Product Y 30% Required: Calculate the break-even sales revenue per period, based on the sales mix assumed Prepare a profit–volume chart of the above situation for sales revenue up to Br.4 000 Show on the same chart the effect of a change in the sales mix to product X 50%, product Y 50%. Clearly indicate on the chart the break-even point for each situation. Of the fixed costs 455 000 are attributable to product X. Calculate the sales revenue required on product X in order to recover the attributable fixed costs and provide a netcontribution of Br.700 000 towards general fixed costs and profit.
Question 1: A company produces and sells two products with the following costs: Product X Product Y Variable costs per Br. of sales Fixed costs per period Br.0.45 Br.1 212 000 Br.0.6 Br.1 212 000 Total sales revenue is currently generated by the two products in the following proportions: Product X 70% Product Y 30% Required: Calculate the break-even sales revenue per period, based on the sales mix assumed Prepare a profit–volume chart of the above situation for sales revenue up to Br.4 000 Show on the same chart the effect of a change in the sales mix to product X 50%, product Y 50%. Clearly indicate on the chart the break-even point for each situation. Of the fixed costs 455 000 are attributable to product X. Calculate the sales revenue required on product X in order to recover the attributable fixed costs and provide a netcontribution of Br.700 000 towards general fixed costs and profit.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 1:
A company produces and sells two products with the following costs:
|
|
Product X |
Product Y |
|
Variable costs per Br. of sales Fixed costs per period |
Br.0.45 Br.1 212 000 |
Br.0.6 Br.1 212 000 |
Total sales revenue is currently generated by the two products in the following proportions:
Product X 70%
Product Y 30%
Required:
- Calculate the break-even sales revenue per period, based on the sales mix assumed
- Prepare a profit–volume chart of the above situation for sales revenue up to Br.4 000 Show on the same chart the effect of a change in the sales mix to product X 50%, product Y 50%. Clearly indicate on the chart the break-even point for each situation.
- Of the fixed costs 455 000 are attributable to product X. Calculate the sales revenue required on product X in order to recover the attributable fixed costs and provide a netcontribution of Br.700 000 towards general fixed costs and profit.
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