A company manufactures a single product. Budget and Standard cost details for next year include:  Selling Price per unit                                           R24.00 Variable Production cost per unit                        R8.60 Fixed production costs                                         R650 000 Fixed selling and distribution costs                      R230 400 Sales commission                                                 5% of selling price Sales                                                                    90 000 units  Required The marketing manager has suggested that the selling price per unit can be increased to R25.00.If the sales commission is increased to 8% percent of selling price and a further R10 000 is speny on advertising Calculate the revised breakeven point based on the marketing managers suggestion

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter16: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 10E: Schylar Pharmaceuticals, Inc., plans to sell 130,000 units of antibiotic at an average price of 22...
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QUESTION2                                                                                                                      

A company manufactures a single product. Budget and Standard cost details for next year include: 

Selling Price per unit                                           R24.00

Variable Production cost per unit                        R8.60

Fixed production costs                                         R650 000

Fixed selling and distribution costs                      R230 400

Sales commission                                                 5% of selling price

Sales                                                                    90 000 units 

Required

  1. The marketing manager has suggested that the selling price per unit can be increased to R25.00.If the sales commission is increased to 8% percent of selling price and a further R10 000 is speny on advertising
  2. Calculate the revised breakeven point based on the marketing managers suggestion
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