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Prepare written report with recommendations based on the analysis made which also outlines the limitations of breakeven analysis. Your report should include a profit statement
Prepare written report with recommendations based on the analysis made which also outlines the limitations of breakeven analysis. |
Your report should include a profit statement indicating the contribution, profit, break-even point, margin of safety and contribution/sales ratio in respect of the status quo and the new proposal.
Calibri (Body) 4 ab Wrap Text Merge & C Office Update To keep up to date with security updates, fixes and improvements, choose Check for Upd X V fx I LL U CO Mock ABC Ltd produces three products: Product AA BB Units Cost Units Cost Units Cost 4 10,200 68,000 3,500 88,000 6,000 44,000 6,800 38,000 2,400 50,000 3,200 28,000 2,200 28,000 1,300 44,000 1,200 14,000 Unit selling price (E) 15.00 35.00 17.50 Required from the information given: 1 Segregate the costs into fixed and variable components and calculate the fixed costs in total for the product mix. 2 Calculate the contribution/sales ratio for all three products. 3 Produce a multi-product profit volume graph based on the highest level of activity of each product, indicating breakeven point and margin of safety. Calculate the overall contribution/sales ratio for all three products together. 4 Prepare a written report with recommendations based on the analysis made which also outlines the limitations of breakeven analysis. Your report should include a profit statement indicating the contribution, profit, break-even point, margin of safety and contribution/sales ratio in respect of the status quo and the new proposal. Proposal Product BB reduce selling price to E32 and thereby increase sales to 4,000 units Product cc reduce variable costs to per unit Question Enter Accessibility: InvestigateStep by Step Solution
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