KonikaEnterprises distributes a single product whose selling price is tk30 and whose variable expense is tk22 per unit. The company’s monthly fixed expense is tk24,000. Required: Prepare a cost-volume-profit graph for the company up to a sales level of 6,000 units.
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
- KonikaEnterprises distributes a single product whose selling price is tk30 and whose variable expense is tk22 per unit. The company’s monthly fixed expense is tk24,000.
Required:
- Prepare a cost-volume-profit graph for the company up to a sales level of 6,000 units.
- Estimate the company’s break-even point in unit sales using your cost-volume-profit graph.
2.Lina Corporation has a single product whose selling price is tk110 and whose variable expense istk60 per unit. The company’s monthly fixed expense is tk60,000.
Required:
- Using the equation method, solve for the unit sales that are required to earn a target profit of tk15,000.
- Using the equation method, solve for the unit sales that are required to earn a target profit of tk25,000.
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