Limpopo Limited plans to manufacture a new energy efficient outdoor light and the following information is available: The estimated sales for the year 2024 are 5000 units at R30 each. The estimated costs for the 2024 year comprise of direct materials and direct labour of R9 and R2 per unit respectively. Fixed factory overheads are R20 000 per annum, fixed administrative expenses are R23 000 per annum and selling expenses are calculated at 20% of selling price per unit. Required: 1.1 Calculate the breakeven quantity (round off to nearest unit) 1.2 Calculate the breakeven value 1.3 Calculate the breakeven value using the marginal income ratio.

Limpopo Limited plans to manufacture a new energy efficient outdoor light and the following information is available: The estimated sales for the year 2024 are 5000 units at R30 each. The estimated costs for the 2024 year comprise of direct materials and direct labour of R9 and R2 per unit respectively. Fixed factory overheads are R20 000 per annum, fixed administrative expenses are R23 000 per annum and selling expenses are calculated at 20% of selling price per unit. Required: 1.1 Calculate the breakeven quantity (round off to nearest unit) 1.2 Calculate the breakeven value 1.3 Calculate the breakeven value using the marginal income ratio.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 19P

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