Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Greenweed Limited manufactures specially treated garden benches. The following information was extracted from the budget for the year ended 29 February 2020: The estimated sales
Greenweed Limited manufactures specially treated garden benches. The following information was extracted from the budget for the year ended 29 February 2020: The estimated sales for the financial year are 2000 units. The selling price per garden bench is R450. Variable production cost per garden bench comprises of the following: Direct materials: R135 Direct Labour: R90 Overheads: R45 The cost for fixed production overheads are R127 500 and selling and administrative expenses are broken down as follows: Salary of sales manager for the year: R75 000 Sales commission: 10% of sales Required: (Round of answers to the nearest rand or whole number) 4.1 Calculate the breakeven quantity. 4.2 Determine the break-even value using the marginal income ratio. 4.3 Calculate the margin of safety. 4.4 Determine the number of sales units required to make a profit of R150 000. 4.5 Suppose Greenweed Limited wants to make provision for a 10% increase in fixed production costs and an increase in variable costs of R15 per unit. Calculate the new break-even quantity
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started