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Answer the questions from the information provided. (25 Marks) 4.1 Use the information provided below to calculate the following: (16 marks) 4.1.1 The total
Answer the questions from the information provided. (25 Marks) 4.1 Use the information provided below to calculate the following: (16 marks) 4.1.1 The total revenues at break-even using the contribution margin ratio, if the sales manager's proposal is rejected. (4 marks) 4.1.2 The margin of safety (in units) if the sales manager's proposal is rejected. (4 marks) 4.1.3 The additional expenditure that the company can afford on advertising in terms of the sales manager's proposal. (4 marks) 4.1.4 The variable cost per unit that will enable the company to break-even, if the sales manager's proposal is accepted. (4 marks) INFORMATION Xpanda Enterprises manufactures a product that sells for R9 each. The company presently produces and sells 100 000 units per year. Unit variable manufacturing and selling costs are R4.50 and R0.90 respectively. Fixed costs are R226 800 for manufacturing overheads and R97 200 for selling and administrative activities. The sales manager has proposed that the selling price be increased to R10.80 per unit. To maintain the present sales volume, advertising must be increased. The company's profit objective is 10% of sales.
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