Question Selasih Company manufactures aluminium containers for restaurants. The owner of Selasih, Puan Atiqah, believes that an aggressive campaign is needed next year due to the Malaysian local market's uncertain conditions. Presented below is the data for the current year 2021, for use in next year's cam paign. COST SCHEDULE Variable Costs per Box Fixed Costs per Month (RM) (RM) Manufacturing: Manufacturing overhead Selling and Administrative 25,000 Direct materials 4 110,000 135,000 Direct labour per unit Manufacturing overhead Total Total 3 15 Puan Atiqah has set the sales target for the year 2022 at a level of RM550,000 (22,000 units of containers), or ten percent more than the sales in the year 2021. The selling price of the container is RM25 each, for both years. Required: a) Prepare a contribution margin income statement for the year 2021. b) Calculate Selasih's break-even point in units and ringgit for the year 2021 c) PuanAtiqah believes that to attain the sales in 2022; the company must incur an additional selling expense of RM10,000 for advertising in 2022, with all other costs remaining constant. What will be the break-even point in RM salesfor 2022 if the company spends the additional RM10,000?

Question Selasih Company manufactures aluminium containers for restaurants. The owner of Selasih, Puan Atiqah, believes that an aggressive campaign is needed next year due to the Malaysian local market's uncertain conditions. Presented below is the data for the current year 2021, for use in next year's cam paign. COST SCHEDULE Variable Costs per Box Fixed Costs per Month (RM) (RM) Manufacturing: Manufacturing overhead Selling and Administrative 25,000 Direct materials 4 110,000 135,000 Direct labour per unit Manufacturing overhead Total Total 3 15 Puan Atiqah has set the sales target for the year 2022 at a level of RM550,000 (22,000 units of containers), or ten percent more than the sales in the year 2021. The selling price of the container is RM25 each, for both years. Required: a) Prepare a contribution margin income statement for the year 2021. b) Calculate Selasih's break-even point in units and ringgit for the year 2021 c) PuanAtiqah believes that to attain the sales in 2022; the company must incur an additional selling expense of RM10,000 for advertising in 2022, with all other costs remaining constant. What will be the break-even point in RM salesfor 2022 if the company spends the additional RM10,000?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter11: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 19E

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