3.1 Examples

REQUIRED Calculate the following from the information given below: 3.1.1 Break-even quantity Break-even value using the marginal income ratio 3.1.2 3.1.3 Margin of safety (in Rands) 3.1.4 Total Marginal Income and Net Profit/Loss if the sales price is reduced to R90 per unit. (3 marks) (4 marks) (3 marks) (4 marks) INFORMATION Dynamo Ltd manufactures calculators. The following information was extracted from the budget for the year ended 31 December 2023: Sales volume Selling price per unit Variable manufacturing cost per unit Variable marketing cost per unit Fixed manufacturing cost Fixed administration and marketing costs 20 000 units R100 R50 10% of the unit selling price R400 000 R200 000

Calculate the following from the information given below: 3.1.1 Break-even quantity (3 marks) 3.1.2 Break-even value using the marginal income ratio (4 marks) 3.1.3 Margin of safety (in Rands) (3 marks) 3.1.4 Total Marginal Income and Net ProfitLoss if the sales price is reduced to R90 per unit. (4 marks) INFORMATION Dynamo Ltd manufactures calculators. The following information was extracted from the budget for the year ended 31 December 2023