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Question 3 A firm produces and sells a single product X. The following information has been collected for a specific period. Budgeted Sales Price
Question 3 A firm produces and sells a single product X. The following information has been collected for a specific period. Budgeted Sales Price Material and labour costs 9000 units 12 Per unit 9 Per unit Variable Selling and Administrative 0.50 Per unit Overhead Fixed Selling and Administrative 15,000 Amount Overhead Actual Sales 8000 units There is no opening or closing stock in the period concerned. Required: (a) What is the Breakeven Units? (b) Calculate budgeted profit or loss. (e) Calculate actual profit or loss for the period. (d) What is meant by the term 'Cost-Volume-Profit'? (+) Draw a sketched graph displaying 'Cost-Volume- Profit' (break-even) analysis. (D) Discuss how the margin of safety can be ascertained for a given or expected level of activity, discussing this by use of the above graph.
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