3.1

REQUIRED

Calculate the following from the information given below:

3.1.1 Break-even quantity

3.1.2 Break-even value using the marginal income ratio

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. (4 marks)

INFORMATION

Dynamo Ltd manufactures calculators. The following information was extracted from the budget for the year ended 31 December 2023:

Sales volume	20 000 units
Selling price per unit	R100
Variable manufacturing cost per unit	R50
Variable marketing cost per unit	10% of the unit selling price
Fixed manufacturing cost	R400 000
Fixed administration and marketing costs	R200 000