) Xerox is a company that has been printing T-Shirts for the Kenyan Market for the last two years. The following income statement has been provided for the Xerox printers ltd for the year 2020.The income statement provided below was prepared on the basis of production of 40,000 T-Shirts and Sale of 40,000 T-Shirts during the year 2020 required: a. Calculate the break-even both in units and sales value using the contribution margin method for Xerox Ltd for the year 2020 b. Calculate the number of Units (T-Shirts) that the Xerox ltd will have to produce and sell to earn a target profit of Shs 10,000,000.
) Xerox is a company that has been printing T-Shirts for the Kenyan Market for the last two years. The following income statement has been provided for the Xerox printers ltd for the year 2020.The income statement provided below was prepared on the basis of production of 40,000 T-Shirts and Sale of 40,000 T-Shirts during the year 2020 required: a. Calculate the break-even both in units and sales value using the contribution margin method for Xerox Ltd for the year 2020 b. Calculate the number of Units (T-Shirts) that the Xerox ltd will have to produce and sell to earn a target profit of Shs 10,000,000.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
) Xerox is a company that has been printing T-Shirts for the Kenyan Market for the last two
years. The following income statement has been provided for the Xerox printers ltd for the
year 2020.The income statement provided below was prepared on the basis of production of
40,000 T-Shirts and Sale of 40,000 T-Shirts during the year 2020
required:
a. Calculate the break-even both in units and sales value using the contribution margin method
for Xerox Ltd for the year 2020
b. Calculate the number of Units (T-Shirts) that the Xerox ltd will have to produce and sell to
earn a target profit of Shs 10,000,000.
Transcribed Image Text:Shs
Sales
12,000,000
Less Variable Production Cost:
Direct Material Cost
1,500,000
Direct Labour Cost
900,000
Variable Production overhead cost
1,200,000
3,600,000
(3,600,000)
Gross Contribution Margin
8,400,000
Less other Variable costs:
Variable Administration overhead cost
180,000
(180,000)
Variable Selling & Distribution overhead cost
200,000
(200,000)
Net Contribution Margin
8,020,000
Less Fixed Cost:
Fixed Production overhead cost
3,000,000
Fixed Administration overhead cost
1,800,000
Fixed Selling & Distribution overhead cost
300,000
5,100,000
(5,100,000)
Net Profit
2,920,000
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