1. A company sold fans at shs 2,000 each. Variable cost shs. 1,200 each and fixed cost shs. 610,000. Calculate:

a. Calculate break even sales in sh.

b. Break even sales in units.

c. Sales in units to earn a profit of shs. 20,000.

2. The following details relate to a shop which currently sells 25,000 pairs of shoes annually.

Selling price per pair of shoes shs.40 Purchase cost per pair of shoes shs.25

Total annual fixed costs shs.

Salaries 100,000

Advertising 40,000

Other fixed expenses 100,000

Required

i. What is the contribution per pair of shoes?

ii. What is the break-even number of pairs of shoes?