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Faber-Cleanz Ltd. is a manufacturer of municipal litter bins in Kamloops, B.C. Each bin is sold for $255. The bins cost $87 in direct materials

Faber-Cleanz Ltd. is a manufacturer of municipal litter bins in Kamloops, B.C. Each bin is sold for $255. The bins cost $87 in direct materials (all variable costs) and $43 in direct labor (all variable costs). In December 2021 the company plans to sell 1,600 bins. Its budgeted fixed costs for the month are $150,350.

  1. What is the companys budgeted contribution for December 2021? (3 marks)

  1. What is the companys budgeted net profit for December 2021? (2 marks)

  1. Calculate the breakeven sales in dollar value for Faber-Cleanz. (3 marks)

  1. Calculate the new breakeven sales (in dollar value) for the company if fixed cost increased by 10%. (2 marks)

  1. Calculate the following if the company wants to allocate 15% margin of safety to its budgeted profit before the increase of its fixed cost (in (d)):

  1. Targeted sales in dollar value and, (2.5 marks)
  2. Targeted sales in number of units. (2.5 marks)

[Total = 15 Marks]

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