Scooters Ltd sells three types of scooters. It has fixed costs of $258,000 per month. The sales
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Scooters Ltd sells three types of scooters. It has fixed costs of $258,000 per month. The sales and variable costs of these products for April are shown below:
S1 | S2 | S3 | |
Sales | $1 000 000 | $1 500 000 | $2 500 000 |
Variable costs | $ 700 000 | $ 900 000 | $1 250 000 |
Determine the sales mix of the three products.
Calculate the break-even point in sales dollars for the company.
Calculate the break-even point in sales dollars for each scooter.
Calculate the margin of safety at the present sales level in dollars.
Discuss the weaknesses of the CVP analysis technique as a financial planning tool.
Can flexible budgets be used to overcome its weaknesses? Explain.
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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