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Deshi Industries plans to manufacture gas stoves and the following information is applicable: Estimated sales for the year 3 0 0 0 units at R
Deshi Industries plans to manufacture gas stoves and the following information is applicable:
Estimated sales for the year units at R each
Estimated costs for the year:
Variable costs R per unit
Factory overheads all fixed R
Administrative expenses all fixed R
Calculate the:
Total operating profit for the estimated figures.
Breakeven quantity
Breakeven value
Margin of safety in units.
Target sales volume to achieve a profit of R
The sales manager is of the opinion that a greater profit will be made if the selling price is decreased by as sales volume will then increase by Calculate the total operating profit at the new selling price and advice management whether to implement this suggestion.
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