Question $2$

RB Ltd sells a single product and its costs are as follows:

Variable costs are:

direct materials @ $\frac{10}{?}$ unit

direct labour @ $\frac{8}{?}$ unit

variable overhead @ $6/$unit

Fixed costs are $68,000.$

Selling price is $30$

Calculate the following:

a$)$ Breakeven point in units

b$)$ Breakeven point in value

c$)$ Margin of safety in units

d$)$ Margin of safety in value

e$)$ Explain what your margin of safety calculations mean.

The company wishes to make a target profit of $16,000.$

What level of sales is required:

e$)$ in units

f$)$ in value