Answered: INFORMATION Samcor Limited manufactures…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 15EA: Cold X, Inc. uses this information when preparing their flexible budget: direct materials of $2 per...

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Given the information in the image below, please help me find the answer to each of the following indepedently:
1. Calculate the total Marginal Income and Net Profit/Loss if all the tables are sold.
2. Use the marginal income ratio to calculate the break-even value.
3.Calculate the new total Marginal Income and Net Profit/Loss, if an increase in advertising expense
by R100 000 is expected to increase sales by 400 units.
4. How many units must be sold if the company wishes to earn a net profit of R298 920.
5.Based on the expected sales volume of 2 400 units, determine the sales price per unit (expressed
in rands and cents) that will enable the company to break even.

INFORMATION
Samcor Limited manufactures tables. The following information was extracted from the budget for the year ended 30
June 2022:
1. Total production and sales
2.
3.
4.
5.
Selling price per table
Variable manufacturing costs per table:
Direct material
Direct labour
Overheads
Fixed manufacturing overheads
Other costs:
Fixed marketing and administrative costs
Sales commission
2 400 units
R1 200
R288
R192
R96
R216 960
R144 000
5%

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