Gombak Roda (GR) sells bicycles in Selangor. The shop has expanded their varieties of bicycles they sold. The following is the expected sales and cost (in RM) for the month according to the types of bicycles sold in Gombak Roda:

Road bikes (RB)

Folding bikes (FB)

Mountain bikes (MTB)

Total Percentage of total sales 50 % 20 % 30 % 100 % Sales (RM) 300,000 100 120,000 100 180,000 100 600,000 100 Variable expenses (RM) 159,000 53 80,000 67 84,000 47 323,000 54 Contribution margin (RM) 141,000 47 40,000 33 96,000 53 277,000 46 Budgeted sales units 1,500 Gombak Rodas net operating income is budgeted at RM65,000 for the month and the estimated break-even sales is RM535,000. Fixed expenses are RM212,000. Apparently, for the current month the actual sales was RM750,000, higher than the budgeted sales. The actual sales by product were: Road bike (RB) RM180,000; Folding bike (FB) RM270,000; and Mountain bike (MTB) RM300,000. Due to the pandemic, the Restricted Movement Control Order (RMCO) in the country has badly affected the economy as well as the country. On the other hand, since the borders between countries were still closed, many people had opted to maximise their time with new hobbies. Where among the hobbies is, cycling. There has been an increase in the demand on special orders for MTB with additional features. The special order has reached to 100 bicycles. These special orders will be sold for RM550 per unit. These extra modifications would consist of brackets to hold radios, mobile phones and other gear. These modifications would require RM140 of incremental variable costs. In addition, Gombak Roda would have to pay a fixed RM24,000 to welders, in order to design and cut special alloy brackets for these additional gadgets. This is a one-time order that would not affect the companys regular business. Under normal circumstances, the variable expenses consist of manufacturing cost only.