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Cost per unit of product: Direct material 30 Direct labor 24 ...

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Accounting

Cost per unit of product: Direct material 30
Direct labor 24
Variable production overhead 6
Selling and distribution 1.35
Fixed overhead (based on production and sales of 1,500 units)
Production overhead 19,800
Selling and distribution
Required: 12,600
a) Calculate the contribution sales ratio.
b) Calculate GSBs break-even points (in units and in RM).
c) How many units would GSB have to sell to earn a net profit of RM80,000?
(3 marks)
(3 marks)
(4 marks)
d) Calculate GSBs margin of safety (in units and in RM).
(2 marks)
e) After the data was collected, the new director realized that manufacturers had increased the production overhead by 25% for the next year due to an increase in the price of a type of raw material for making the product. Calculate the new break-even points in units and in RM.

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