The following information regarding Toti Ltd, which manufactures only one product, is available for 2022: Toti Ltd expects to sell 8 000 units at R400 per unit. Each unit requires 4 kg of materials at a cost of R25 per kg and 0.5 hours of direct labour at a cost of R60 per hour. Variable manufacturing overheads are estimated at R40 per direct labour hour. Fixed costs are budgeted at R1 600 000. ENG

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Question 3.2

Using information from the attached picture:

Calculate the selling price per unit that will realize an operating profit of R720000. 

The number of units that must be sold in order to earn an operating profit of R720000, if the selling price increases by 10% and fixed costs increase by R87000. 

 

INFORMATION
The following information regarding Toti Ltd, which manufactures only one product, is available for 2022:
Toti Ltd expects to sell 8 000 units at R400 per unit. Each unit requires 4 kg of materials at a cost of R25 per kg and
0.5 hours of direct labour at a cost of R60 per hour. Variable manufacturing overheads are estimated at R40 per
direct labour hour. Fixed costs are budgeted at R1 600 000.
09:11
21°C ^
ENG
2021/11/2
PrtScr
Insert
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Transcribed Image Text:INFORMATION The following information regarding Toti Ltd, which manufactures only one product, is available for 2022: Toti Ltd expects to sell 8 000 units at R400 per unit. Each unit requires 4 kg of materials at a cost of R25 per kg and 0.5 hours of direct labour at a cost of R60 per hour. Variable manufacturing overheads are estimated at R40 per direct labour hour. Fixed costs are budgeted at R1 600 000. 09:11 21°C ^ ENG 2021/11/2 PrtScr Insert Home F9 F10 F11 F12 F6 F7 F8
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