Answered step by step
Verified Expert Solution
Question
1 Approved Answer
You own a small mobile store that sells popcorn ( usually outside The Leverton - Graham s cinema ) . This small business is called
You own a small mobile store that sells popcorn usually outside The Leverton Grahams cinema This small business is called Popup and has been operating for a number of years. It is transportable and you are hired out for other events like sport matches, st birthday parties, and sometimes even weddings. You feel it is time to move on in your career, so you are deciding whether or not to sell the small business or pass it on to your brother, who is studying to be an accountant. Before you do this, you need to get the financials and management accounts in order so that you can prove this is a profitable business. You have the following information about your business and its monthly expenses and figures:
You sold packets of popcorn this past month and produced packets.
Each packet of kernels is g which costs R to buy from your suppliers.
Each packet of popcorn sold contains g of popcorn kernels.
You sell the popcorn for R a bag.
The mobile store depreciates at R per month.
Other costs that were incurred while making the popcorn are the following:
Electricity amounted to R this past month. In previous months it was R at the highest level of activity when you made bags of popcorn and R at the lowest level of activity when you made bags of popcorn.
Paper bags are R for bags.
You pay yourself a salary of R a month. If you are currently selling packets of popcorn, calculate the margin of safety in units. Include a definition and show your calculations
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started