Ripper Ltd produces and sells elegant sofa beds. Data from the 2021 financial year is presented below. The tax rate is 30%

Costs

Direct Materials $10,000

Direct Labor $30,000

Electricity used in production $4,000

Rent for production facility $400,000

Salary for the production manager $60,000

Annual cost of internet $24,000

Total Costs $528,000

Revenues

Price per unit $1,200

Total units produced and sold in 2021 - 2000

Required:

a. Calculate net income for the 2021 financial year

b. Classify the above costs as either fixed or variable. Summarise these costs in the table provided

c. Assume that all variable and fixed costs remain steady for the 2022 financial year. Calculate the number of units required to break even in 2022.

(Hint: use the 2021 data to find the variable cost per unit, then apply your knowledge to calculate breakeven. Approach this task any way you see fit.)

d. The manager seeks an after tax profit of $210,000. How many units must Ripper Ltd sell to achieve this target in 2022?

e. Illustrate the CVP relationship for Ripper Ltd by constructing a CVP graph. Use as much space as needed.

(Hint for part (d): The CVP graph presents Total costs of production against total revenues.) (To do part (d) effectively, you will be required to prepare a table illutstraintg at least two data points so that you can represent 2 straight lines)