Question
Problem 1 PT. Nusa Penida produced and sold skateboard for export. They reached its breakeven point at $5,400,000 of revenues. At present, it is selling
Problem 1 PT. Nusa Penida produced and sold skateboard for export. They reached its breakeven point at $5,400,000 of revenues. At present, it is selling 200,000 units and its variable costs are $30. Fixed manufacturing costs, administrative costs, and marketing costs are $300,000, $450,000, and $310,000 respectively. The tax rate is 30%. Required:
1. Compute the contribution margin percentage
2. Compute the selling price
3. Compute the margin of safety in units and dollars
4. Compute the degree of operating leverage. If the sales revenue is 50% higher than expected, what is the percentage increase in profit?
5. How many units must be sold to earned after tax profit of $1,500,000?
6. Marketing manager proposed additional advertising budget for $300,000 and bonus for salesperson 10% of revenue generated. This action expected to increase 30% of unit sold. Assuming there is no change in selling price, Will CFO of PT. Indah Nusa agreed to accept this proposal? Explain. (Hint: Compare the operating income with original data)
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