Question 1 Duku Sdn Bhd is a single-product entity, and provides the summary data shown below relating to its product for 2022. + Selling price per unit Variable manufacturing costs Annual fixed manufacturing costs Variable marketing, distribution and administration costs Annual fixed non-manufacturing costs Annual volume + Required: a) Calculate the contribution margin per unit and contribution margin ratio. b) Calculate the break-even in units and in RM for 2022. c) What is the profit in 2022? RM60 RM30 RM500,000 RM10 RM200,000 50,000 units + d) The Sales Manager of Duku has proposed to reduce the selling price by 10% and is confident that the sales will increase by 20% in 2023. Should Duku adopt this proposal? e) Duku has rejected the Sales Manager's proposal. Duku is also considering changes in plant operations and the production process for 2023. The changes would result in a reduction of variable costs per unit of RM5 and increase fixed manufacturing costs by RM100,000. How many units would need to be sold to earn the same profit as in 2022?
Question 1 Duku Sdn Bhd is a single-product entity, and provides the summary data shown below relating to its product for 2022. + Selling price per unit Variable manufacturing costs Annual fixed manufacturing costs Variable marketing, distribution and administration costs Annual fixed non-manufacturing costs Annual volume + Required: a) Calculate the contribution margin per unit and contribution margin ratio. b) Calculate the break-even in units and in RM for 2022. c) What is the profit in 2022? RM60 RM30 RM500,000 RM10 RM200,000 50,000 units + d) The Sales Manager of Duku has proposed to reduce the selling price by 10% and is confident that the sales will increase by 20% in 2023. Should Duku adopt this proposal? e) Duku has rejected the Sales Manager's proposal. Duku is also considering changes in plant operations and the production process for 2023. The changes would result in a reduction of variable costs per unit of RM5 and increase fixed manufacturing costs by RM100,000. How many units would need to be sold to earn the same profit as in 2022?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Question 1
Duku Sdn Bhd is a single-product entity, and provides the summary data shown below
relating to its product for 2022.
+
Selling price per unit
Variable manufacturing costs
Annual fixed manufacturing costs
Variable marketing, distribution and administration costs
Annual fixed non-manufacturing costs
Annual volume
+
Required:
a) Calculate the contribution margin per unit and contribution margin ratio.
b) Calculate the break-even in units and in RM for 2022.
c) What is the profit in 2022?
RM60
RM30
RM500,000
RM10
RM200,000
50,000 units
+
d) The Sales Manager of Duku has proposed to reduce the selling price by 10% and is
confident that the sales will increase by 20% in 2023. Should Duku adopt this
proposal?
e) Duku has rejected the Sales Manager's proposal. Duku is also considering changes
in plant operations and the production process for 2023. The changes would result in
a reduction of variable costs per unit of RM5 and increase fixed manufacturing costs
by RM100,000. How many units would need to be sold to earn the same profit as in
2022?
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