Sibon ple manufactures soft toys for the European market. The costs incurred by the firm are...
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Sibon ple manufactures soft toys for the European market. The costs incurred by the firm are as follows: Materials (per toy) Wages (per toy) Packaging (per toy) Rent of premises Machinery hire Marketing and administration 5 4 3 5,000 3,000 1.000 The soft toys sell for an average price of $15. The company's capacity of Sibon plc is 2,000 toys per year. Required 1- Calculate the variable costs and the fixed costs. (2 points) 2- Calculate the margin of safety. (1 point) 3- When the business breaks-even, what it the total revenue? (2 points) 4- Is the capacity of the business aligned with the potential breakeven point in quantity? Explain your answer based on the given and your previous answers. (2 points) Sibon ple manufactures soft toys for the European market. The costs incurred by the firm are as follows: Materials (per toy) Wages (per toy) Packaging (per toy) Rent of premises Machinery hire Marketing and administration 5 4 3 5,000 3,000 1.000 The soft toys sell for an average price of $15. The company's capacity of Sibon plc is 2,000 toys per year. Required 1- Calculate the variable costs and the fixed costs. (2 points) 2- Calculate the margin of safety. (1 point) 3- When the business breaks-even, what it the total revenue? (2 points) 4- Is the capacity of the business aligned with the potential breakeven point in quantity? Explain your answer based on the given and your previous answers. (2 points)
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1 Variable costs per toy are the costs that vary with the level of production which are the costs of ... View the full answer
Related Book For
Fundamentals of Cost Accounting
ISBN: 978-0077398194
3rd Edition
Authors: William Lanen, Shannon Anderson, Michael Maher
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