Question
Q#1HASF & Company produces cleaning kits for shotguns. The production capacity available will enable the firm to produce 50,000 kits annually. A projected income statement
Q#1HASF & Company produces cleaning kits for shotguns. The production capacity available will enable the firm to produce 50,000 kits annually. A projected income statement for next year shows Sales 460,000 Costs of goods sold 296,000 Gross profit 164,000 Selling and administrative expenses 125,000 Net income 39,000 Fixed manufacturing overhead costs 40% of the cost of goods sold. Regular selling price per unit is 10 A 10% sales commission is paid to sales representatives for each kit sold. The purchasing department of a large discount chain has offered to purchase 1500 kits at $6 each. Company sales managers initial response is to refuse the offer because he concludes that the $6 price is below the firms average cost The sales commission would not be paid on the special order.
What is the lowest price per unit the firm could accept if it wants to earn annual net income of 48,000 ( ignore sales commission )
q2 HASF & Company produces cleaning kits for shotguns. The production capacity available will enable the firm to produce 50,000 kits annually. A projected income statement for next year shows Sales 460,000 Costs of goods sold 296,000 Gross profit 164,000 Selling and administrative expenses 125,000 Net income 39,000 Fixed manufacturing overhead costs 40% of the cost of goods sold. Regular selling price per unit is 10 A 10% sales commission is paid to sales representatives for each kit sold. The purchasing department of a large discount chain has offered to purchase 1500 kits at $6 each. Company sales managers initial response is to refuse the offer because he concludes that the $6 price is below the firms average cost The sales commission would not be paid on the special order.
What will be the impact on net income??
q3 The HASF Ink Ltd income statement for the preceding year is presented below except as noted the cost / revenue relationship for the coming year is expected to follow the same pattern as in the preceding year income statement for the year ending March 31 is as follow s Sales (200,000 units @ 2.5 Each) Rs. 5, 00,000 Variable cost 3, 00,000 Contribution margin 2, 00,000 Less Fixed cost 100,000 Profit before tax 100,000 Less tax 35,000 Profit after tax 65,000 Required
The company management feels that it should earn at least Rs.10, 000 pre taxes per annum on the new investment what sales volume is required to enable the company to maintain existing profit.
i want just answer not a solution please be quick
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started