Consider the information provided below as well as the financial statements and answer the questions that follow. Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glass wine bottles for the Blue Valley Beer Co 2019 2020 Sales price per unit R15 R19 Variable cost per unit R6 R7 Fixed cost (FC) per annum R650 000 R855 500 Fixed cost per unit R3 R4 Current assets R450 600 R560 700 Current liabilities R510 000 R780 000 Retained profit R21 809 R17 600 Net Sales R2 900 320 R3 100 100 Cost of sales R390 000 R475 000 a. Calculate the break-even point for Pearson & Litt for 2019 and 2020 b. Compare the results of the 2019 and 2020 break-even points and explain

Consider the information provided below as well as the financial statements and answer the questions that follow. Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glass wine bottles for the Blue Valley Beer Co 2019 2020 Sales price per unit R15 R19 Variable cost per unit R6 R7 Fixed cost (FC) per annum R650 000 R855 500 Fixed cost per unit R3 R4 Current assets R450 600 R560 700 Current liabilities R510 000 R780 000 Retained profit R21 809 R17 600 Net Sales R2 900 320 R3 100 100 Cost of sales R390 000 R475 000 a. Calculate the break-even point for Pearson & Litt for 2019 and 2020 b. Compare the results of the 2019 and 2020 break-even points and explain

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter15: Capital Investment Analysis

Section: Chapter Questions

Problem 15.1C: Ethics and professional conduct in business Erin Haywood was recently hired as a cost analyst by...

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Consider the info provided below as well as the financial statements and answer the questions that follow.Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glass wine bottles for the Blue Valley Beer Co. For 2019 and 2020 respectively :Sales price per unit R15 and R19Variable cost per unit R6 and R7Fixed cost (FC) per annum R650 000 and R 855 500Fixed cost per unit R3 and R4Current assets R450 600 and R560 700Current liabilities R510 000 and R780 000Retained profit R21 809 and R17 600Net Sales R2 900 320 and R 3 100 100Cost of sales R390 000 and R475 000 The current ratio reflects the relationship between the value of the current assets and the extent of the current liabilities of a business.Q.1 Calculate the current ratio for Pearson & Litt for 2019. Q.2 Explain the results of the current‐test ratio.HINT: Include the minimum ratio recommended for the ratio in youranswer.
Consider the info provided below as well as the financial statement and answer the questions that follows Pearson & Litt is a manufacturing company in the Eastern Cape. Their factory manufactures glass wine bottles for the Blue Valley Beer Co. 2019 2020 Sales price per unit R15 R19 Variable cost per unit R6 R7 Fixed cost (FC) per annum R650 000 R 855 500 Fixed cost per unit R 3 R 4 Current assets R 450 600 R 560 700 Current liabilities R 510 000 R 780 000 Retained profit R 21 809 R 17 600 Net Sales R 2 900 320…
Assume that the following table represents a production schedule for Rhithabile Enterprises, a South African company that produces a cheaper 70% alcohol hand sanitizer for the local market to fight COVID19. The company started operating in January 2021 and output started coming out in February. Month Quantity (Litres) Total Revenue in Rands Total Cost in Rands (TC)‘000’ Profit Average Revenue Average production Cost (TR) ‘000’ (R) ‘000’ (R) (R) Jan 0 0 200 -200 - - Feb 1000 - 300 100 - - March 2000 800 500 - - - April - 1200 - 400 - - May 4000 1600 1200 - - - June - 2000 - 300 - - July 6000 - 2300 - - - Aug 7000 2800 3000 - - - Sept 9000 3200 - -600 - - Questions:1a. Complete the table by calculating the missing figures. 1b. At what quantity (Litres) is revenue (TR) maximised? 1c. In which month/s and at what quantities was profit maximised?1d. The profit figure for the month of January is –R200.…
Coffee works Limited manufactures coffee machines for domestic use. The management of the company is considering next year’s production and has asked you to help with certain financial decisions. The following information is available: Selling price (per machine) £80 Direct materials (per machine) £25 Direct labour (per machine) £20 Fixed production overheads £270,000 per year. The company is planning to manufacture 15,000 coffee machines next year. (a) calculate the marginal cost per coffee machine (b) calculate the absorption cost per coffee machine (c) prepare a statement of profit or loss (under marginal and absorption costing method) to show the profit or loss if 15,000 coffee machines are sold
Shiraz Manufacturers commenced operations on 02 January 2022 by manufacturing lounge shirts and selling them to retailers. Their aim is to eventually become a leading clothing manufacturer by producing a broad spectrum of quality products. They are situated in Durban but hope to expand their operations to other parts of the country. During 2022 Shiraz Manufacturers produced 90 000 shirts and sold 80 000 of them at R150 each. Variable manufacturing costs amounted to R40 per unit and variable marketing costs amounted to R30 per unit sold. Fixed costs totaled R 1 200 000 of which R900 000 was for manufacturing overheads and R300 000 was for administration and marketing. Shiraz Manufacturers had the intention of producing 120 000 shirts during 2023. However they manufactured only 100 000 shirts and sold 80% of the shirts produced at R160 each. Variable manufacturing costs increased by 10% and whilst the variable marketing costs of R30 per unit sold also applied to 2023, a sales commission…
Lokalalo is a New Zealand company helping Kiwi families redesign their homes. The balance date is 31 August. Both a2 Milk Ltd. And Synlait Ltd. operate in the dairy products industry. The following ratios for a2 Milk Ltd. and Synlait Ltd. were calculated for 2020 and 2019: a2 Milk Ltd. Synlait Ltd. 2020 2019 2020 2019 Gross Profit Margin 55.96% 54.84% 15.64% 18.19% Profit Margin 22.29% 22.12% 5.78% 8.03% Return on Assets 44.52% 48.54% 9.33% 12.81% Return on Equity 40.15% 42.83% 13.69% 17.93% Current Ratio 3.69 times 3.15 times 1.00 times 0.76 times Debt ratio 21.97% 21.76% 59.36% 57.20% Based on the above ratios, comment on a2 Milk Ltd.’s and complete the following Profitability in the Income Statement Profitability to investment Briefly summaries the profitability of a2 Milk by comparing with Synlait Ltd.
Use the information given below to calculate each of the following independently 3.5 Selling price per unit that will enable the company to achieve a net profit of R1 500 000 INFORMATIONSlumber Limited manufactures beds. The following information was extracted from the budget for 2024:Expected production and sales (units) 1 200Selling price per bed R6 000Direct materials cost per bed R1 700Direct labour cost per bed R860Variable manufacturing overheads cost per bed R320Fixed manufacturing overheads cost R1 084 800Sales commission (as a percentage of the selling price) 20%Fixed administrative and selling costs R720 000 PLEASE PUT THE ANSWER IN RANDS
A young entrepreneur founded a packaged beverage company in early 2022. Based on information gathered from consumers, the young entrepreneur plans to increase sales of packaged drinks in 2023, by producing packaged drinks with new flavors.Revenue in 2022 is $500,000 and is expected to reach $1,500,000 in 2023. Each bottled beverage will sell for $5, and the bottled beverage costs $2 per bottle to produce. Administrative costs including the young entrepreneur’s salary, salary of one accountant and three clerks, are estimated at $200,000 and marketing costs such as posters, advertisements in local newspapers, are estimated at $350,000 in 2023. Then, investment in special equipment and renovation of Warehouses accounts for $562,500 and $62,500 in inventory, which was done in 2022. Moreover, an additional $150,000 in equipment investment is expected to be needed in early 2023 to increase the production volume of their bottled beverage. Currently, the old machine is still capable of…
The pictures below are supposed to be answered using this information: Siren Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2020, the company incurred the following costs. Variable Costs per Unit Direct materials $10.65 Direct labor $4.90 Variable manufacturing overhead $8.24 Variable selling and administrative expenses $5.54 Fixed Costs per Year Fixed manufacturing overhead $319,500 Fixed selling and administrative expenses $298,342 Siren Company sells the fishing lures for $35.50. During 2020, the company sold 80,000 lures and produced 90,000 lures.
Kevian ltd Kenya soft drink manufacturer. The following information has been provided by the cost accountant of the company in relation to a new energy drink Kev-Power that the company is interested in investing in. The company plans to produce 80,000 bottles of Kev-Power and sell 80,000 bottles of Kev-Power during the first year 2021. The company plans to sell each bottle of Kev-Power at Shs.198. The Variable costs for the year in relation to production and sale of the 80,000 bottles of Kev-Power is as provided in the table below. Variable Costs Per Bottle Produced Direct Material Cost Shs 6 per Bottle Direct Labour Cost Shs 3 per Bottle Variable Production overhead cost Shs 3.8 per Bottle Variable Administration overhead cost Shs 2.5 per Bottle Variable Selling & Distribution overhead cost Shs 1.5 per Bottle 4.The Fixed costs for the year in relation to production and sale of the 80,000 bottles of Kev-Power is as provided in the…
Ethics and professional conduct in business Erin Haywood was recently hired as a cost analyst by Wind River Medical Supplies Inc. Oneof Erin’s first assignments was to perform a net present value analysis for a new warehouse.Et-in performed the analysis and calculated a present value index of 0.8. The plant manager.ZuhairBarbat, is very intent on purchasing the warehouse because he believes that more storage space is needed. Zuhair asks Erín into his office and the following conversation takes place: ZubairErín, you’re new here, aren’t you? EHii: Yes, sir. Zubair: V.dl, Erin, let me tell you something. ¡m not at all pleased with the capital investment analysis that you performed on this new warehouse. T need that warehouse for my production. If I dont get it, where am I going to place our output? Erín: Hopefully with the customer, sir. Zithair: Now don’t get smart with me. Erín: No, really. I was being serious. My analysis does not support constructing a new ware- house. The numbers don’t lie: the warehouse does not meet our investment return targets. In fact, it seems to me that purchasing a warehouse dots not add much value to the business. We need to be producing product to satisfy customer orders, not to fill a warehouse. Zubair Listen, you need to understand sonwthing. The headquarters people will not allow mv to build the warehouse if the numbers dont add up. You know as well as I that many assump tions go into your net present value analysis. Why don’t you relax some of your assumptions so that the f́nancial savings will offset the cost? Erín: I’m willing to discuss my assumptions with you. Maybe I overlooked something. Zubafr Good. Here’s what I want you to do. 1 see in your analysis tha you don’t project greater sales as a result of the warehouse. It seems to me, if we can store more goxLs, then will have more to sell. Thus, logically, a larger warehouse translates into more sales. If you incorporate this into your analysis, I think you’ll see that the numbers will work out. Why don’t you work it through and come back with a new analysis? I’m really counting on you on this one. Let’s get off to a good start together and see if we can get this project accepted. What is your advice to Erin?
Al Maha Ceramics SAOG is to provide quality ceramic tiles and world class designs in Oman. The company is planning to sell the package of tiles for OMR 450 and want to achieve 25% as target profit. Examine what would the company’s target cost for this product? a. OMR 300 b. OMR 400 c. OMR 320 d. OMR 360

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bartleby, a Learneo, Inc. business

	2019	2020
Sales price per unit	R15	R19
Variable cost per unit	R6	R7
Fixed cost (FC) per annum	R650 000	R855 500
Fixed cost per unit	R3	R4
Current assets	R450 600	R560 700
Current liabilities	R510 000	R780 000
Retained profit	R21 809	R17 600
Net Sales	R2 900 320	R3 100 100
Cost of sales	R390 000	R475 000