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Rumah Kaseh provides daycare for elderly and bed-ridden patients for seven days a week. It charges each elderly RM1,280 per head per month. Its monthly
Rumah Kaseh provides daycare for elderly and bed-ridden patients for seven days a week. It charges each elderly RM1,280 per head per month. Its monthly variable costs per person and total monthly fixed cost are as follows: Variable Costs: RM Fixed Costs: RM Meals & beverages 195 Salaries 5,800 Medical supplies 112 Utilities 900 Other supplies (toiletries, personal 53 Rent 4,200 health care products, etc.) Other expenses 1,900 Total 360 Insurance Total 1,000 13,800 REQUIRED: (a) Compute the contribution margin percentage. (b) Calculate the break-even point. (1 Marks) (2 Marks) (c) Rumah Kaseh's target operating income is RM15,640 per month. Compute the number of elderly clients who must be enrolled to achieve the target operating income. (2 Marks) (d) Currently there are 20 clients enrolled at Rumah Kaseh. Compute the margin of safety in units and Malaysian Ringgit (RM). (2 Marks) (e) Referring to your answers in (d), what does this tell you about the risk of Rumah Kaseh making a loss? What are the most likely (making a loss) to increase
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