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Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.   Sales revenue of RM 1,200,000 is expected. Fixed overheads are forecasted at RM 120,000 for the year. The variable costs per unit are as follows: Direct materials                       RM 40 Direct labour                           RM 12 Variable overheads                 RM 8   Required: Calculate for the current year the: contribution/sales ratio  break-even point in sales revenue and units  margin of safety as a percentage of sales  budgeted profit

Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.   Sales revenue of RM 1,200,000 is expected. Fixed overheads are forecasted at RM 120,000 for the year. The variable costs per unit are as follows: Direct materials                       RM 40 Direct labour                           RM 12 Variable overheads                 RM 8   Required: Calculate for the current year the: contribution/sales ratio  break-even point in sales revenue and units  margin of safety as a percentage of sales  budgeted profit

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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Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.

 

Sales revenue of RM 1,200,000 is expected.

Fixed overheads are forecasted at RM 120,000 for the year.

The variable costs per unit are as follows:

Direct materials                       RM 40

Direct labour                           RM 12

Variable overheads                 RM 8

 

Required:

Calculate for the current year the:

  • contribution/sales ratio 
  • break-even point in sales revenue and units 
  • margin of safety as a percentage of sales 
  • budgeted profit 

 

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