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Madam Sally produces and sells two food products: Agidi and Fula. Current revenue, cost, and unit sales data are below. Agidi Fula Selling price per
Madam Sally produces and sells two food products: Agidi and Fula. Current revenue, cost, and unit sales data are below.
| Agidi | Fula |
Selling price per unit | GHS 0.80 | GHS 1.5 |
Variable expenses per unit | GHS 0.35 | GHS 1.1 |
Number of units sold monthly | 25,000 units | 30,000 units |
Fixed expenses are GHS8,000 per month.
Required:
- Compute the break-even point in cedis for the entire business.
- Compute the margin of safety as percent of sales for the entire business.
- Assuming the sales mix above, determine the break-even point in cedis for each of the products.
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