Question
Futonto Company produces and sells a single product. The company's income statement for the most recent month is given below: Sales (6,000 units at Tk
Futonto Company produces and sells a single product. The company's income statement for the most recent month is given below: Sales (6,000 units at Tk 40 per unit) Tk 240,000 Less manufacturing costs: Direct materials Tk 48,000 Direct labor (variable) Tk 60,000 Variable factory overhead Tk 12,000 Fixed factory overhead Tk 30,000 Tk 150,000 Gross margin Tk 90,000 Less selling and other expenses: Variable selling and other expenses Tk 24,000 Fixed selling and other expenses Tk 42,000 Tk 66,000 Net operating income Tk 24,000 Note: There are no beginning or ending inventories. Required: a. Prepare a contribution format income statement. b. Compute the company's monthly break-even point both in units and taka. c. What would the company's monthly net operating income be if sales increased by 25% and there is no change in total fixed expenses? d. What amount of sales (in taka) must the company achieve in order to earn a net operating income of Tk 50,000 per month?
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