Question
CVP analysisConex Limited sells one product, Supercreme,a cream suitable for a variety offirst aiduses. Thecompany commenced operations earlier this year and expects to sell 100,000
CVP analysisConex Limited sells one product, Supercreme,a cream suitable for a variety offirst aiduses. Thecompany commenced operations earlier this year and expects to sell 100,000 tubes of Supercreme.The following information is available:Selling price per tube7.00Direct material cost per tube2.10Direct labour cost per tube1.35Variable overhead cost per tube0.75Total fixed costs for the year210,000Requireda)For Conex Limited, what is the Break-even point (BEP) in tubes and sales revenue?b)If the company wanted to earn a profit of 46,200 for the year how many tubes of Supercreme mustbe sold?c)By how much could expected sales revenue fall before Conex Limited starts to make a loss?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started