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Bloomy Sdn Bhd is a newly established skincare manufacturing company based in Kota Kinabalu. At the moment, the company is producing only one product called
Bloomy Sdn Bhd is a newly established skincare manufacturing company based in Kota Kinabalu. At the moment, the company is producing only one product called Whity Serum which is sold at RM100 per unit. Below is the information regarding the costs and revenues incurred in producing 100,000 units of Whity Serum for the current year: RM Sales revenue 10,000,000 Variable production costs - Direct material 2,300,000 - Direct labour 2,200,000 - Direct expenses 1,000,000 Fixed production overhead 1,100,000 Fixed selling expenses Y00,000 Fixed administration expenses 600,000 Variable selling expenses is charged at 15% of selling price per unit. Required: {Each question is to be treated independently.) a. Classify the current cost into: i. Total variable cost per unit ii. Total fixed cost for the year (4 marks) b. Determine for the current year: i. The break-even point (in units and RM) ii. The margin of safety (in units and RM) iii. Number of units to be sold it the company plans to achieve a profit of RMQOOQOO (8 marks) To boost the sales quantity, the company plans to spend RM95.000 for its advertising expenses. This will result in the budgeted sales quantity to increase by 30% from the current sales level. In addition, the variable selling expenses is expected to change to RM2O per unit. Required: Predict the new profit for the company. (7 marks) (Total: 25 marks)
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