Case Study Analysis

Instruction:

This section consists of three $(3)$ main questions.

Please answer ALL questions by using the answer template $($Excel Format$)$ provided.

Please submit you answer script in Excel Format.

Total marks are $40/100.$

Question $1$

Portrait Imaging Company is considering introducing a new video camera. Its selling price is projected to be

RM$1200$ per unit. Variable manufacturing costs are estimated to be RM$360$ per unit. Variable selling costs

are $20\%$ of sales ringgit. The company expects the annual fixed manufacturing costs for the new camera to

be $RM4,200,000.$

a$.$ Compute Portrait Imaging's contribution margin per unit and contribution margin ratio.

$(10$ marks$)$

b$.$ Determine the number of units Portrait Imaging must sell to break even.

$(5$ marks$)$

c$.$ Portrait Imaging is considering a design modification that would reduce the variable cost of the

camera by RM$200$ per unit. Explain whether this change will cause Portrait Imaging's breakeven

point to increase or decrease when compared to the initial plans. Please show any changes in the

new costs in your calculation and analysis to reflect this modification.