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Question 3 (10 marks) Korona Company developed the following information for the product it sells: Sales price $50 per unit Direct materials $15 per unit
Question 3 (10 marks) Korona Company developed the following information for the product it sells: Sales price $50 per unit Direct materials $15 per unit Direct labour $5 per unit Variable manufacturing overhead S8 per unit Fixed manufacturing overhead S550.000 Variable selling expense 10% of sales price Fixed selling expense $500.0XXO Variable administrative expense $2 per unit Fixed administrative expense $300,000 For the year ended 31 December 2019, Korona Company produced and sold 100,000 units of product. (c) (2 marks) Advise the President whether the marketing manager's proposal should be adopted. Give examples of circumstances in which that Cost-Volume-Profit assumption is violated. (d) (3 marks) [Total for Question 3: 10 marks]
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