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Hair Limited manufactures air conditioner for the export market. The sales and production cost data are as follows: RM Selling price per unit of air-conditioner
Hair Limited manufactures air conditioner for the export market. The sales and production cost data are as follows: RM Selling price per unit of air-conditioner 1,500 Variable production cost per unit 900 Total fixed production overhead 1,500,000 Capital investment 2.000.000 Required: a) Calculate the break-even point in quantity and sales value. b) Calculate the profit or loss at the activity level of 5,000 units. c) Calculate the margin of safety at the sales level of RM6,000,000. d) Calculate the required activity level to achieve a return of 40% on capital investment. e) Explain breakeven analysis in detail including its advantages and disadvantages
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