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a company has three shops (R, S and T) to which the following budgeted information relates : Shop R 000 Shop S 000 Shop T
a company has three shops (R, S and T) to which the following budgeted information relates :
Shop R
000
Shop S
000
Shop T
000
Total
000
Sales 400 500 600 1500
Contribution 100 60 120 280
Less: Fixed Cost (60) (70) (70) (200)
Profit/Less 40 (10) 50 80
Sixty per cent of the total fixed costs are general company overheads. These are apportioned to the shops on the basis of sales value. The other costs are specific to each shop and are avoidable if the shop closes down.If shop S closed down and the sales of the other two shops remained unchanged, what would be the revised budgeted profit for the company?
a.
50 000
b.
60 000
c.
90 000
d.
70 000
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