Use the information given below to calculate each of the following independently: 3.1 Expected total Marginal Income
Question:
Use the information given below to calculate each of the following independently:
3.1 Expected total Marginal Income and Net Profit/Loss
3.2 Margin of safety (as a percentage; expressed to two decimal places)
3.3 Break-even quantity if the selling price drops by 10% (
3.4 Break-even value using the marginal income ratio, if the company spends an additional R435 200 on salaries
3.5 Selling price per unit that will enable the company to achieve a net profit of R1 500 000 (4 marks) INFORMATION Slumber Limited manufactures beds. The following information was extracted from the budget for 2024: Expected production and sales (units) 1 200 Selling price per bed R6 000 Direct materials cost per bed R1 700 Direct labour cost per bed R860 Variable manufacturing overheads cost per bed R320 Fixed manufacturing overheads cost R1 084 800 Sales commission (as a percentage of the selling price) 20% Fixed administrative and selling costs R720 000
Expert Answer:
To calculate the requested values lets use the provided information Expected production and sales units 1200 Selling price per bed R6000 Direct materials cost per bed R1700 Direct labor cost per bed R... View the full answer
