Anima Bakery sells both White Bread and Wholewheat Bread. Following are the information of variable cost...
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Anima Bakery sells both White Bread and Wholewheat Bread. Following are the information of variable cost for 2022 budget: White Bread $5 $2.5 $0.6 $0.2 10% of selling price of bread type Wholewheat Bread SS Selling price Ingredients costs Direct processing labour cost Packaging material cost Marketing commission $ 5.8 $0.75 S0.18 In order to produce the bread, Anima Bakery needs to rent an industrial kitchen in BSD city at a cost of $190,000 per year. In addition, there is a fixed general and admin expenses of $101,250. In 2022, Anima Bakery expects to sell 5 loaves of white bread for every 3 loaves of wholewheat bread. Anima Bakery are currently developing its plan for 2022. Required: (there is no correlation between the different scenarios) 1. How many loaves of white bread and wholewheat bread that Anima Bakery have to sell in 2022 to reach a breakeven point? How much is the breakeven revenue? (6%) 2. Considering the tax rate of 25%, How many loaves of each bread that Anima Bakery need to sell if they want to eam an after-tax income of $648,000 in 2022? (6%) 3. Anima Bakery received an offer to rent an industrial kitchen in BKS city instead of in BSD city. The industrial kitchen in BKS city is more expensive and it would cost additional $28,200 of rental cost per year. However, it has more updated appliances and therefore reduce the direct labour required for bread production by 6%. Considering the expected operating income of S1,000,000 and the 2022 expected sales mix, what would be the required quantity of sales for each bread type? Anima Bakery sells both White Bread and Wholewheat Bread. Following are the information of variable cost for 2022 budget: White Bread $5 $2.5 $0.6 $0.2 10% of selling price of bread type Wholewheat Bread SS Selling price Ingredients costs Direct processing labour cost Packaging material cost Marketing commission $ 5.8 $0.75 S0.18 In order to produce the bread, Anima Bakery needs to rent an industrial kitchen in BSD city at a cost of $190,000 per year. In addition, there is a fixed general and admin expenses of $101,250. In 2022, Anima Bakery expects to sell 5 loaves of white bread for every 3 loaves of wholewheat bread. Anima Bakery are currently developing its plan for 2022. Required: (there is no correlation between the different scenarios) 1. How many loaves of white bread and wholewheat bread that Anima Bakery have to sell in 2022 to reach a breakeven point? How much is the breakeven revenue? (6%) 2. Considering the tax rate of 25%, How many loaves of each bread that Anima Bakery need to sell if they want to eam an after-tax income of $648,000 in 2022? (6%) 3. Anima Bakery received an offer to rent an industrial kitchen in BKS city instead of in BSD city. The industrial kitchen in BKS city is more expensive and it would cost additional $28,200 of rental cost per year. However, it has more updated appliances and therefore reduce the direct labour required for bread production by 6%. Considering the expected operating income of S1,000,000 and the 2022 expected sales mix, what would be the required quantity of sales for each bread type?
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Working notes White Wholewheat Total Bread Bread Selling price per unit Less Variable cost per unit ... View the full answer
Related Book For
Horngrens Financial and Managerial Accounting
ISBN: 978-0133866292
5th edition
Authors: Tracie L. Nobles, Brenda L. Mattison, Ella Mae Matsumura
Posted Date:
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