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Aragon Ltd makes a single product which selis for 12.00. The following represents sales (units) and profit figures for a six month period during 2010:
Aragon Ltd makes a single product which selis for 12.00. The following represents sales (units) and profit figures for a six month period during 2010: Required: (a) From the above information calculate: (i) Fixed costs. [1] (ii) Variable cost per unit. [1] (iii) Profit-volume ratio. [1] (iv) Break-even. [1] (v) Margin of safety. [1] (b) On the graph paper provided, graph both a break-even chart and a profit- [3] volume chart, confirming graphically the calculations from (a) above. (c) What would the average monthly sales need to be if total profit for the [ 4] second 6 months of 2010 had to be E400,000 ? (d) Outine the key assumptions that lie behind profit-volume analysis. [3]
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