Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Pure Manufacturing has predicted the following cost information for the year ending 30 June 2021.- Variable Costs Manufacturing Operating 122,000 72,000 Fixed Costs $e Manufacturing

image text in transcribed

Pure Manufacturing has predicted the following cost information for the year ending 30 June 2021.- Variable Costs Manufacturing Operating 122,000 72,000 Fixed Costs $e Manufacturing 170,000 Operatinge 71,500 - Sales for the period ending 30 June 2021 are predicted to be $484,000 You are required to: a. Determine the break-even point in units for Pure Manufacturing for the period ending 30 June 2021 assuming the revenue and cost predictions it has made for the period are based on selling 19,400units. You must show all your working. b. Determine the break-even point in sales dollars for Pure Manufacturing for the period endinge 30 June 2021 c. Tough economic times are being forecast for New Zealand in the year ahead. Pure Manufacturing is therefore considering the need to decrease its selling price per unit by 10%- and also to decrease its planned advertising for the year by $10,000. You are required to calculate the predicted Net Profit for the business assuming it is still able to sell the predicted 19,350 units. d. Assuming the business decreases its predicted selling price per unit by 10% and decreases itse planned advertising for the year by $10,000 (as in c. above), determine how many units Pure Manufacturing must make and sell if it wishes to earn a Net Operating Profit of $40,000

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

Auditing For Managers The Ultimate Risk Management Tool

Authors: K. H. Spencer Pickett, Jennifer M. Pickett

1st Edition

0470090987, 978-0470090985

More Books

Students also viewed these Accounting questions

Question

How did you feel about taking piano lessons as a child? (general)

Answered: 1 week ago