Question
(a) Identify five assumptions of Cost Volume Profit analysis. (5 Marks) (b) Al Hassan Omani Limited manufactures 4 products at its GBOOPA plant in
(a) Identify five assumptions of Cost Volume Profit analysis. (5 Marks) (b) Al Hassan Omani Limited manufactures 4 products at its GBOOPA plant in Sohar estate. The company sold 450,000 units of its product at 60 OMR per unit. Variable cost at 45 OMR pr unit, while the fixed costs incurred evenly throughout the year amounted to OMR 2,916,000 which comprises of manufacturing costs of OMR 1,800,000 and selling cost of 1,116,000. You are required to calculate the following: i. The breakeven point in units and value. ii. The number of units that must be sold to earn an income of OMR 225,000 before income tax.
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