1. Jordan Co started operations on manufacturing and selling smart pens. They have gathered following expected information for the year 2020:

Selling price (per unit) 69

Direct materials (per unit) 9.50

Direct labour (per unit) 3.00

Other costs are estimated for the year 2020 based on the expected sales of 45,000 units. These costs are given below:

		Fixed Costs	Variable Costs
Operating Costs		190,000	550,000
Marketing Costs		270,000	600,500
Storage Costs		130,000	42,000
Administration Costs		100,000	-

For the year 2020, you are required to calculate:

1. the expected profit or loss
2. breakeven point in units and sales revenue
3. margin of safety in units and % change
4. the profit/loss if the selling price is reduced to 65 and sales quantity increases by 20%
5. the revised break-even point in units for (d)
6. explain the importance of computing break-even point for a Jordan Co.