Read the reflection questions below, include your calculations and workings in the document

Question 1 (1 Mark)

Oren Manis has a division that makes burlap bags for the citrus industry. The division has fixed costs of $20,000 per month, and it expects to sell 60,000 bags per month. If the variable cost per bag is $2.50, what is the price of the division charge in order to break even?

Question 2 (4 Marks)

The following information pertains to the Strawberry Shortcake Berhad chain:

Sales	RM600,000
Variable costs	200,000
Total contribution margin	400,000
Fixed costs	150,000
EBIT	250,000
Interest expense	50,000
Earnings before taxes	200,000
Taxes (30%)	60,000
Net income	RM140,000

Required:

1. What is the BEP(RM) for Strawberry Shortcake Berhad?
2. Calculate the degree of operating leverage at this level of output for Strawberry Shortcake Berhad.
3. Calculate the degree of financial leverage at this level of output for Strawberry Shortcake Berhad.
4. What is the combined leverage for Strawberry Shortcake Berhad?
5. If sales increase by 10%, what will be the new level of Strawberry Shortcake Berhads EPS if the firm has 50,000 shares outstanding?