Question
A business student who recently completed Business Decision Making has decided to set up a food cart opposite your Lucro Island hotel selling artisan ice
A business student who recently completed Business Decision Making has decided to set up a food cart opposite your Lucro Island hotel selling artisan ice creams in 500g tubs to hotel guests.
They have provided you with the following estimates for the next quarter:
| Expected Sales (units) | 30,000 |
| Selling price per unit | $35 |
| Variable cost per unit | $10 |
| Total fixed costs | $350,000 |
REQUIRED:
a) Calculate the breakeven point in units and sales dollars. Show your workings. (2 marks)
b) Calculate the margin of safety in sales dollars. Show your workings. (1 mark)
Submit your answer in text form below.
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Auditing Theory And Practice
Authors: John Dunn
2nd Edition
0132408961, 978-0132408967
