1.CoolRoom Limited manufactures a portable room cooler which is sold to retailers at a cost of 280 per cooler. The factory has been operating at 75% capacity for a number of years. The costs for this output level are as follows:

Direct Material per cooler

65

Direct Labour per cooler

30

Manufacturing overhead (per annum)

Fixed

80,000

Variable

40,000

Selling and Distribution Overhead (per annum)

Fixed

21,000

Variable

20,000

Last year, because of the mild summer, the company only operated at 60% of its capacity. The sales revenue achieved last year was 224,000.

Required:

(a) Calculate the break-even point for the company in terms of (i) the number of coolers and (ii) total sales.

(b) Calculate the profit or loss reported at (i) 75% capacity output and (ii) 60% capacity output.