Exam Paper Three

Question Three

Assume that you are planning to sell jerseys at the forthcoming rugby tournament at $40 each, the jerseys cost $20 to produce and you incur $2000 to rent a booth in the showground.

• Compute the Break-even point
• Compute the margin of safety
• Compute the number of units that must be sold to earn profit of 20% before text.
• Compute the number of units that must be sold to earn an after Tax profit of $2,560. Assuming that Tax is 30%.