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Anawer each of the following questlons Independently. As far as posslble use the expanded contribution margin model to present your answers. 2.4 Suppose an additonal
Anawer each of the following questlons Independently. As far as posslble use the expanded contribution margin model to present your answers. 2.4 Suppose an additonal R300 000 is spent on advertising in order to increase the sales by 3(4 000 palets. Calculate the number of palets that need to be produced and sold to breakmarks) even. 2.5 Suppose the management team of Lomax Ltd is considering a R3D per palet decrease (4 In the selling price with the expectation that this would Increase the sales volume by 10\%. Is this a good idea? Motivate your answer with the relevant calculations. 2.6 Determine the sellng price per pallet that wil enable Lomax Ltd to achleve an operathg pront of R3 192 o00. INFORMATION Lomax Ltd sells the bricks that it produces in palets, wth each palet containing 500 oricks. The follosing budgeted information for 2022 is avaliable: The number of pallets that are expected to be produced and sold during 2022 is 30000 . Each palet is expected to be sold for R500. The drect matedals cost per brick is R0.14 whilst the direct labour cost per brick is RD.08. R0.04 per brick goes towards variable manufacturing overheads. Flxed manufacturing overheads are expected to total R1 500000 . Annual advertising and salespersons salaries are estimated at R2 160000 . The salespersons are also entlied to a sales commission of 6%. Flxed administration costs are expected to be R3 840000 whilst other administration costs are estimated at RAD per pallet sold. administration costs are estimated at RAD per pallet sold. The management is examining various proposals to assist in decision-making for 2022
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