Dee and Co. is a small manufacturing company which has prepared the following monthly budgeted figures for a typical month: Production Volume 18,000 units Selling priceper unit GH¢8.50 Sales GH¢153,000 Total Variable Costs GH¢63,000 Total fixed Costs GH¢40,000 Profit GH¢50,000 Required: what is the contribution per unit? determine the contribution to sales ratio what is the number of units andvalue that D
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Dee and Co. is a small manufacturing company which has prepared the following monthly budgeted figures for a typical month:
Production Volume 18,000 units
Selling priceper unit GH¢8.50
Sales GH¢153,000
Total Variable Costs GH¢63,000
Total fixed Costs GH¢40,000
Profit GH¢50,000
Required:
what is the contribution per unit?
determine the contribution to sales ratio
what is the number of units andvalue that Dee and Co. needs to produce and sell each month in order to break even?
Find the sales revenue in value required to make a target profit of GH¢ 80,000.
The managers are thinking of installing a new machine which will increase fixed costs by GH¢8,000 per month, but will reduce variable costs by 10%. if production remains at 18,000 units per month, what willbe the profit if this is implemented, and what will be the new break-even point in value?
In applying the cost-volume-profit (CVP) analysis for short term decision purposes, certain assumptions are relevant. Enumerate at least four (4) of such assumptions
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