Cost management –

A firm makes a single product with a marginal cost of $3.50 and a selling price of $5.50. Fixed costs are $30 000 per period. You are required to calculate: a. The C/S ratio b. Sales at break-even point c. Number of units to break even d. Sales to achieve a profit of $10 000 Question 2 a) Smith Limited has made the following estimates for next month Selling price $25 per unit Variable cost $10 per unit Fixed costs for the month $300 000 Forecast output 30 000 units Maximum output 40 000 units You are required to calculate the: i) contribution margin ratio ii) break-even point in units iii) break even points in sales revenue iv) margin of safety at the forecast output v) number of units to generate a profit of $100 000 b) List and explain five (5) assumptions of break-even analysis The post Cost management first appeared on Template.


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