1.1 If the cost of manufacturing (direct material and direct labor) is 60% of sales and profit...

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1.1 If the cost of manufacturing (direct material and direct labor) is 60% of sales and profit is 10% of sales, what would be the improvement in profit if, through better planning and control, the cost of manufacturing was reduced from 60% of sales to 50% of sales?

Answer. Profits would improve by 100%.

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