The following information relates to Gretan Ltd and Hutey Ltd. Both companies manufacture and sell calculators....
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The following information relates to Gretan Ltd and Hutey Ltd. Both companies manufacture and sell calculators. Gretan Ltd Hutey Ltd Sales in units per year 20,000 20,000 Selling Price Rs500 Rs500 per unit high grors margin Low varahle rorts inpl hot Variable Cost per unit Rs300 Rs100 Annual Fixed Costs Rs3,000,000 Rs7,000,000 opere leve Required (a) Calculate the Break Even Point in units for each company. [2 marks] Calculate the net profit of each company at the current sales level. Ameosuroc degree a firm Con in rease ororating income by increasirg (b) [3 marks] (c) Calculate the operating leverage of each company. rererle [3 marks] (d) Using your answer in (c), calculate the new net profit of each company if both companies experience an increase in sales volume by 40%. [3 marks] The following information relates to Gretan Ltd and Hutey Ltd. Both companies manufacture and sell calculators. Gretan Ltd Hutey Ltd Sales in units per year 20,000 20,000 Selling Price Rs500 Rs500 per unit high grors margin Low varahle rorts inpl hot Variable Cost per unit Rs300 Rs100 Annual Fixed Costs Rs3,000,000 Rs7,000,000 opere leve Required (a) Calculate the Break Even Point in units for each company. [2 marks] Calculate the net profit of each company at the current sales level. Ameosuroc degree a firm Con in rease ororating income by increasirg (b) [3 marks] (c) Calculate the operating leverage of each company. rererle [3 marks] (d) Using your answer in (c), calculate the new net profit of each company if both companies experience an increase in sales volume by 40%. [3 marks]
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a Breakeven point Greaten Ltd 3000000500300 15000 units Hutey Ltd ... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0324592375
17th Edition
Authors: James D. Stice, Earl K. Stice, Fred Skousen
Posted Date:
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