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Example 1: A company that produces a perfumes daily, the variable cost (product cost) per unit is 30$, the selling price is equal to 50 $ per unit, the cost of workers is 300 dollars per day, and the cost of raw materials is 600 dollars, in addition to other costs of 100 dollars per day. Fined: 1- (Breakeven point in unit or in any point the total cost equal to the selling price or the number of units to be produced to avoid loss) 2- Breakeven point in sales. 3- Number of unit to obtain on operating profit of 1500$( 4- The operating profit at production and selling 200 unit Solution: For the example one find the Breakeven point in unit and the Breakeven point in sales by chart method. 1- Breakeven point in units == Total cost 300+600+100 = 1000 S Gross profit= 50-30 = 20 S Breakeven point in unit = OR Total fixed cost Gross profit 1000 20 = 50 units of perfume per day F.C 2- Breakeven point in sales Gross porfit saling price 1500-1000 20 n n = 25 unit 1500 = 50xn-1000-30xn 150020n-1000 1000 20 50 Breakeven point in sales Breakeven point in unit x selling price per unit = 50 × 50 = 2500 $ per day 3- operating profit= total Sales-total fixed costs - total variable costs = 2500 $ per day 4- operating profit = Sales - Total fixed costs-total variance costs 50n-1000-30m

Example 1: A company that produces a perfumes daily, the variable cost (product cost) per unit is 30$, the selling price is equal to 50 $ per unit, the cost of workers is 300 dollars per day, and the cost of raw materials is 600 dollars, in addition to other costs of 100 dollars per day. Fined: 1- (Breakeven point in unit or in any point the total cost equal to the selling price or the number of units to be produced to avoid loss) 2- Breakeven point in sales. 3- Number of unit to obtain on operating profit of 1500$( 4- The operating profit at production and selling 200 unit Solution: For the example one find the Breakeven point in unit and the Breakeven point in sales by chart method. 1- Breakeven point in units == Total cost 300+600+100 = 1000 S Gross profit= 50-30 = 20 S Breakeven point in unit = OR Total fixed cost Gross profit 1000 20 = 50 units of perfume per day F.C 2- Breakeven point in sales Gross porfit saling price 1500-1000 20 n n = 25 unit 1500 = 50xn-1000-30xn 150020n-1000 1000 20 50 Breakeven point in sales Breakeven point in unit x selling price per unit = 50 × 50 = 2500 $ per day 3- operating profit= total Sales-total fixed costs - total variable costs = 2500 $ per day 4- operating profit = Sales - Total fixed costs-total variance costs 50n-1000-30m

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Example 1: A company that produces a perfumes daily, the variable cost (product cost) per unit is 30$, the selling price is equal to 50 $ per unit, the cost of workers is 300 dollars per day, and the cost of raw materials is 600 dollars, in addition to other costs of 100 dollars per day. Fined: For the example one find the Breakeven point in unit and the Breakeven point in sales by chart method. 1- (Breakeven point in unit or in any point the total cost equal to the selling price or the number of units to be produced to avoid loss) 2- Breakeven point in sales. 3- Number of unit to obtain on operating profit of 1500$( 4- The operating profit at production and selling 200 unit Solution: 1- Breakeven point in units == Total cost 300+600+100 = 1000 S Gross profit= 50-30 = 20 S Breakeven point in unit = OR Total fixed cost Gross profit 1000 20 = 50 units of perfume per day F.C 2- Breakeven point in sales Gross porfit = saling price 1000 20 50 = 2500 $ per day Breakeven point in sales = Breakeven point in unit x selling price per unit 50 × 50 = 2500 $ per day 1500 = 50xn-1000-30xn 150020n-1000 1500-1000 = 20 n n = 25 unit 3- operating profit= total Sales - total fixed costs - total variable costs 4- operating profit = Sales - Total fixed costs - total variance costs = 50n-1000-30m
Transcribed Image Text:Example 1: A company that produces a perfumes daily, the variable cost (product cost) per unit is 30$, the selling price is equal to 50 $ per unit, the cost of workers is 300 dollars per day, and the cost of raw materials is 600 dollars, in addition to other costs of 100 dollars per day. Fined: For the example one find the Breakeven point in unit and the Breakeven point in sales by chart method. 1- (Breakeven point in unit or in any point the total cost equal to the selling price or the number of units to be produced to avoid loss) 2- Breakeven point in sales. 3- Number of unit to obtain on operating profit of 1500$( 4- The operating profit at production and selling 200 unit Solution: 1- Breakeven point in units == Total cost 300+600+100 = 1000 S Gross profit= 50-30 = 20 S Breakeven point in unit = OR Total fixed cost Gross profit 1000 20 = 50 units of perfume per day F.C 2- Breakeven point in sales Gross porfit = saling price 1000 20 50 = 2500 $ per day Breakeven point in sales = Breakeven point in unit x selling price per unit 50 × 50 = 2500 $ per day 1500 = 50xn-1000-30xn 150020n-1000 1500-1000 = 20 n n = 25 unit 3- operating profit= total Sales - total fixed costs - total variable costs 4- operating profit = Sales - Total fixed costs - total variance costs = 50n-1000-30m
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