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Question 4: (10 marks) (B1, C1) Part A: (7 marks) Fatima Company plans to sell 6,000 units at $60 each in the coming year. Variable
Question 4: (10 marks) (B1, C1) Part A: (7 marks) Fatima Company plans to sell 6,000 units at $60 each in the coming year. Variable cost per unit is $12 and total fixed cost is $24,000. Instructions: 1. Calculate the contribution margin ratio? (1 mark) 2. Calculate the break-even point in units? (2marks) 3. Calculate the break-even point in sales dollars? (2 marks) 4. If Fatima Company has a target profit of $90,000, how many units will they have to sell? (2 marks) Part B: (3 marks) Job 200 consists of 300 units and has total manufacturing costs of direct materials, $4,500; direct labor, $7,500; and overhead, $3,600. Instructions: a. What is the unit product cost? (1 mark) b. What are the prime costs per unit? (2 mark) c. What are the conversion costs per unit? (2 mark)
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