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Question 5 (Cost-volume-Profit analysis) 20 Marks Heae Pharmaceuticals has developed the following data for the 20,000 units of new medicines they hope to produce and

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Question 5 (Cost-volume-Profit analysis) 20 Marks Heae Pharmaceuticals has developed the following data for the 20,000 units of new medicines they hope to produce and sell in the following month: Direct materials $100,000 Direct labour $50,000 Variable overhead $80,000 Fixed overhead $30,000 Variable selling & admin expenses $48,000 Fixed selling & admin expenses $32,000 Required: a) At sales price of $38.00 per unit, how many units would Ganges have to sell in order to break even? b) At a sales price of $43.00per unit, how many units would Ganges have to sell in order to produce a profit of $20,000? c) If 16,000 units were sold, what price would Ganges have to change in order to produce a profit of $42,000 a) Provide one example of management decisions that benefit from cost-volume-analysis (CVP)

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