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Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.   Sales revenue of RM 1,200,000 is expected. Fixed overheads are forecasted at RM 120,000 for the year. The variable costs per unit are as follows: Direct materials                       RM 40 Direct labour                           RM 12 Variable overheads                 RM 8   Required: Calculate for the current year the: contribution/sales ratio  break-even point in sales revenue and units  margin of safety as a percentage of sales  budgeted profit

Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.   Sales revenue of RM 1,200,000 is expected. Fixed overheads are forecasted at RM 120,000 for the year. The variable costs per unit are as follows: Direct materials                       RM 40 Direct labour                           RM 12 Variable overheads                 RM 8   Required: Calculate for the current year the: contribution/sales ratio  break-even point in sales revenue and units  margin of safety as a percentage of sales  budgeted profit

Principles of Cost Accounting
Principles of Cost Accounting
17th Edition
ISBN:9781305087408
Author:Edward J. Vanderbeck, Maria R. Mitchell
Publisher:Edward J. Vanderbeck, Maria R. Mitchell
Chapter8: Standard Cost Accounting—materials, Labor, And Factory Overhead
Section: Chapter Questions
Problem 17P: Shinto Corp. uses a standard cost system and manufactures one product. The variable costs per...
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Salle products manufacture and distribute a single product. The company, which intends to maintain its unit product sales price for the current year, has budgeted to sell 15,000 units.

 

Sales revenue of RM 1,200,000 is expected.

Fixed overheads are forecasted at RM 120,000 for the year.

The variable costs per unit are as follows:

Direct materials                       RM 40

Direct labour                           RM 12

Variable overheads                 RM 8

 

Required:

Calculate for the current year the:

  • contribution/sales ratio 
  • break-even point in sales revenue and units 
  • margin of safety as a percentage of sales 
  • budgeted profit 

 

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