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ABC cimited PManufacitures and SElLS a single Produet x. The standard sercins price is...

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Accounting

ABC cimited PManufacitures and SElLS a single Produet
x. The standard sercins price is $20 per unit and
The standard varible costs per unit atre as folcons:
DIREC MATERIAL $5
DIRECT LAFUUR $4
VARIABLe OVERHEADS $3
THE BUDBETED PRODUCTION IN UNITS IS 2000 AND THE
FIXED COSTS ARE: PRODUCTION OVER HEADS $3200
Marketing overheads $ 1800
Administrative overheads $1000
REQUiRED:
(a) Caleulate the standard costs and profit per unit,
AS well AS THE PROFIT IN TOTAL.
(i) Calculate the breakeven point in units and dollars
(ii) Calculate the margin of Safety in units and dollars
(c) If the company plans to make a profit of $3000,
calculate the new breakeven point in dollars or units.
(d) THE AccountaNT IS CONSIDERing MAKING SOME CHANGES BY
increasing the selling Price per UNIT BY $5,
WHICH WILL RESULT IN A SALES UNITS REDUCING BY 200
UNITS. THE FIXED COST WILL IncREASE BY 5% FOR production
OVERHEADS.
Calculate:
(i) The breakeveN Point in UNITS AND ARLLARS
(ii) THE PROFIT PER UNIT AND IN TOTAL.

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