Question
7 . Using the following symbols: Selling price per unit S Variable cost per unit V Annual fixed costs F Which of the following represents
7. Using the following symbols:
Selling price per unit S
Variable cost per unit V
Annual fixed costs F
Which of the following represents the required level of output to achieve a profit of 10,000?
A. F + (10,000 / (S - V))
B. 10,000 / (S - V - F)
C. (10,000 +F)/(S-V)
D. Fx (10,000 / (S - V))
8. A company is budgeting for production and sale of two of its products, Jacks and Rakes, and has just been informed that its sole supplier of direct materials has gone out of business leaving it with irreplaceable Inventory of 1.740kg of raw material L.
Relevant figures for the two products are:
Jacks Rakes
Maximum demand 800 units 400 units
Budgeted contribution 30 per unit 40 per unit
Raw material L required 2kg per unit 3kg per unit
If the company wishes to maximise contribution, which of the following is the maximum number of Rakes that it should produce?
O A. 46 units
OB. 47 units
O c. 140 units
OD. 270 units
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