Question

Q3. Cost-Volume- Profit & Cost Behaviour Analysis (25 marks) Company C makes calculators that sell for $20 each. For the coming year, management expects fixed costs to total $220,000 and variable costs to be $9 per unit. a) Calculate the break-even point in units b) Calculate the break-even point in dollars c) Calculate the margin of safety, assuming actual sales of $500,000 d) Calculate the sales required in dollars to earn a net income of $165,000 e) company C has a higher operating leverage and if sales are declining what would be the impact on the company's net income and if the sales are increasing what would be the result on the net income

          Q3. Cost-Volume- Profit & Cost Behaviour Analysis (25 marks)
Company C makes calculators that sell for $20 each. For the coming year, management
expects fixed costs to total $220,000 and variable costs to be $9 per unit.
a) Calculate the break-even point in units
b) Calculate the break-even point in dollars
c) Calculate the margin of safety, assuming actual sales of $500,000
d) Calculate the sales required in dollars to earn a net income of $165,000
e) company C has a higher operating leverage and if sales are declining what would be
the impact on the company's net income and if the sales are increasing what would be the
result on the net income

Q3. Cost-Volume- Profit Cost Behaviour Analysis (25 marks)
Company C makes calculators that sell for 20 each. For the coming year, management
expects fixed costs to total220,000 and variable costs to be 9 per unit.
a) Calculate the break-even point in units
b) Calculate the break-even point in dollars
c) Calculate the margin of safety, assuming actual sales of500,000
d) Calculate the sales required in dollars to earn a net income of 165,000
e) company C has a higher operating leverage and if sales are declining what would be
the impact on the company's net income and if the sales are increasing what would be the
result on the net income

Added by F-Tima R.

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