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BU PLC., manufactures and sells a unique product known as B.Sc. the selling price of which is 20. The summarized profit and loss statement
BU PLC., manufactures and sells a unique product known as B.Sc. the selling price of which is 20. The summarized profit and loss statement for 31/12/2007 is as follows: N 600,000 Sales Direct Material Direct Wages Variable Prod. O/H Fixed Production O/H Selling & Distribution Administration Net Profit before tax Less Tax at 40% Profit after Tax Required 11. 111. iv. 90,000 120,000 60,000 75,000 56,000 45.000 446,000 154,000 61.600 92.400 Calculate the break-even point both in units and sales value. Calculate the sales value required to achieve a net profit before tax 15% of total revenue. Assuming no change in unit selling price and cost structure, calculate the percentage increase in sales volume required in the current year to produce a profit before tax 20% higher than that of 2007 result. Determine the volume of sales in naira the company must achieve in 2008 to maintain 2007 net profit if the selling price remains at 20 and variable cost per unit increase by 12%.
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To calculate the breakeven point we need to determine the number of units and sales value required to cover all costs The breakeven point occurs when the total revenue equals total costs First lets ca...Get Instant Access to Expert-Tailored Solutions
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