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Tulidza Ltd manufactures bottles and wants to expand its business. A lot of decisions to implement would depend on your analysis of the data as

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Tulidza Ltd manufactures bottles and wants to expand its business. A lot of decisions to implement would depend on your analysis of the data as contain in its income statement below: Income statement for the period just ended December 31, 2017 is presented below GHC Sales (35,000 traps @ C30 each) 1,050,000 Variable costs (450,000) Fixed costs (100.000) Profit before tax 500,000 Less tax 35,000 Profit after tax 465,000 Required: (i) Calculate the number of bottles to sell to reach the break-even point (ii) Suppose that a plant expansion will add C60,000 to fixed cost and increase capacity by 50 %. How many bottles would they have to be sale after the addition to break-even (iii)At what level of sales will the company be able to maintain its profit before tax position even after expansion? (iv) The company's management feels that it should earn at least 10,000 (profit before tax per annum) on the new investment. What sales volume is required to enable the company to maintain existing profits and earn the minimum required return on the new investments

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