Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I will be grateful if you can write the answer in Word text as I struggle to write on math Thanks in advance PART 2

image text in transcribed

I will be grateful if you can write the answer in Word text as I struggle to write on math

Thanks in advance

PART 2 Breakeven Analysis Enka Ltd. manufactures t-shirts, which sell at 20 each. Table 5 shows the sales and total costs for the period July 2021 to December 2021. Monthly fixed costs have been the same each month and it is expected they will remain constant for the remainder of the financial year (up to and including March 2022). Table 5 - Sales Volume and Total Costs Month Sales (units) Total Cost () July 14,502 195,000 August 15,000 200,400 September 14,000 200,000 October 19,100 241,000 November 24,806 308,060 December 34,000 400,000 Required: In not more than 400 words calculation of the following (show all working out) and comment as required: a. Using the High-low method, estimate the variable cost per t-shirt produced and sold and the fixed cost. Comment on why the High-Low method is used in this case b. Using the information in (a) above, how many t-shirts should Enka Ltd. produce and sell in January 2022 to break even? C. How many t-shirts does the Enka Ltd need to produce and sell to achieve a profit target of 60,000 in January 2022? d. What is the margin of safety for January 2022, assuming the profit target for that month has been achieved? Comment of what this margin of safety means for Enka Ltd. e. State any 3 advantages and 3 disadvantages of breakeven analysis

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Accounting

Authors: Carl s. warren, James m. reeve, Philip e. fess

21st Edition

978-0324400205, 324225016, 324188005, 324400209, 9780324225013, 978-0324188004

Students also viewed these Accounting questions

Question

1. The content model for the WebApp is reviewed to uncover errors.

Answered: 1 week ago