E) Profitability 1) Mr. Jones does not understand Cost Volume Profit Analysis and asks for a brief explanation about it. 5 Marks 2) Having learnt something about CVP, Mr. Jones requests a CVP Statement for one division in the company. He has supplied the following relevant information; Unit Selling Price Unit Variable Costs $ 500 $ 350 Fixed Costs Units Sold $ 72,000 720 You are asked to: a) Prepare a CVP Income statement from the data provided. b) Compute the Break Even Point in Units 6 Marks 4 Marks 3) Mr. Jones points out that within the factory operations there is limited machine time. He is trying to decide which of the products should be produced to maximise the profit. He supplies the following information; Selling Price Variable Costs Machine Hours Required You are asked to.. Product Economy Standard De Luxe $300 $ 500 $700 $144 $ 252 $428 0.6 0.8 1.6 a) Compute the Contribution Margin per unit of Limited Resource b) Advise as to which product should be produced. 9 Marks 1 Mark