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Q3. Huber Company bottles and distributes No-FIZZ, a fruit drink. For the year 2020, management estimates the following revenues and costs costs : Selling price
Q3. Huber Company bottles and distributes No-FIZZ, a fruit drink. For the year 2020, management estimates the following revenues and costs costs : Selling price Tk. 800 per unit Variable costs Tk. 400 per unit Fixed costs 200000 Units sold during the year 750 units Instructions: (a) Prepare a CVP income statement for 2020 based on management's estimates. (b) Compute the break-even point in units and Tk. (c) Compute the margin of safety in units and Tk. (d) Determine the required sales in Tk. and units required to earn net income of Tk. 400,000. (e) Suppose variable cost increased by 10% and Fixed cost decreased by 5%. i. Prepare a CVP income statement for 2020 based on management's new estimates. ii. Compute the break-even point in units and Tk. iii. Compute the margin of safety in units and Tk. iv. Determine the required sales in Tk. and units required to earn net income of Tk. 400,000
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