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Question 3. Based on the attached picture Calculate the following  Break-even value using the contribution margin ratio The increase in operating profit total sales increase by R60000 Margin of safety (in units)

Question 3. Based on the attached picture Calculate the following  Break-even value using the contribution margin ratio The increase in operating profit total sales increase by R60000 Margin of safety (in units)

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 3.

Based on the attached picture

Calculate the following 

Break-even value using the contribution margin ratio

The increase in operating profit total sales increase by R60000

Margin of safety (in units)

Total contribution margin and operating profit (loss), if the selling price increases by 10% and advertising costs increases by R20000

INFORMATION Cook 4life Ltd manufactures pots. The following information was extracted from the budget for the month ended 31 December 2022: Expected sales are 3 000 units at R300 per unit. The direct materials cost, direct labour cost and variable manufacturing overheads cost are estimated at R210 000, R150 000 and R90 000 respectively. Fixed manufacturing overheads and fixed administration costs are expected to total R160 000 and R80 000 respectively. Variable selling and administration costs are estimated at 10% of sales.
Transcribed Image Text:INFORMATION Cook 4life Ltd manufactures pots. The following information was extracted from the budget for the month ended 31 December 2022: Expected sales are 3 000 units at R300 per unit. The direct materials cost, direct labour cost and variable manufacturing overheads cost are estimated at R210 000, R150 000 and R90 000 respectively. Fixed manufacturing overheads and fixed administration costs are expected to total R160 000 and R80 000 respectively. Variable selling and administration costs are estimated at 10% of sales.
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