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REQUIRED Use the information provided below to answer the following questions independently: 3.1 Calculate the margin of safety (expressed in units). 3.2 Use the marginal income ratio to determine the break-even value if the direct manufacturing costs are R10 per unit more than expected. 3.3 Calculate the total Marginal Income and Net Profit/Loss if the sales volume for 2023 is 20% below the budgeted quantity. 3.4 Calculate the number of units that must be sold to earn a net profit of R150 per unit. 3.5 Calculate the break-even quantity if the selling price is reduced by R50 per unit and the fixed manufacturing costs decrease by R22 000. INFORMATION The Salmon Ltd manufactures and sells fishing rods for R600 each. The budgeted sales for 2023 are 22 000 rods and the costs are expected to be as follows: Direct manufacturing costs per unit Variable manufacturing overheads cost per unit Variable administration costs per unit Sales commission Fixed manufacturing costs Fixed administration and selling costs R R200 R50 R40 10% of sales R1 800 000 R600 000

REQUIRED Use the information provided below to answer the following questions independently: 3.1 Calculate the margin of safety (expressed in units). 3.2 Use the marginal income ratio to determine the break-even value if the direct manufacturing costs are R10 per unit more than expected. 3.3 Calculate the total Marginal Income and Net Profit/Loss if the sales volume for 2023 is 20% below the budgeted quantity. 3.4 Calculate the number of units that must be sold to earn a net profit of R150 per unit. 3.5 Calculate the break-even quantity if the selling price is reduced by R50 per unit and the fixed manufacturing costs decrease by R22 000. INFORMATION The Salmon Ltd manufactures and sells fishing rods for R600 each. The budgeted sales for 2023 are 22 000 rods and the costs are expected to be as follows: Direct manufacturing costs per unit Variable manufacturing overheads cost per unit Variable administration costs per unit Sales commission Fixed manufacturing costs Fixed administration and selling costs R R200 R50 R40 10% of sales R1 800 000 R600 000

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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QUESTION 3 REQUIRED Use the information provided below to answer the following questions independently: 3.1 Calculate the margin of safety (expressed in units). 3.2 Use the marginal income ratio to determine the break-even value if the direct manufacturing costs are R10 per unit more than expected. 3.3 Calculate the total Marginal Income and Net Profit/Loss if the sales volume for 2023 is 20% below the budgeted quantity. 3.4 Calculate the number of units that must be sold to earn a net profit of R150 per unit. 3.5 Calculate the break-even quantity if the selling price is reduced by R50 per unit and the fixed manufacturing costs decrease by R22 000. INFORMATION The Salmon Ltd manufactures and sells fishing rods for R600 each. The budgeted sales for 2023 are 22 000 rods and the costs are expected to be as follows: Direct manufacturing costs per unit Variable manufacturing overheads cost per unit Variable administration costs per unit Sales commission Fixed manufacturing costs Fixed administration and selling costs R R200 R50 R40 10% of sales R1 800 000 R600 000
Transcribed Image Text:QUESTION 3 REQUIRED Use the information provided below to answer the following questions independently: 3.1 Calculate the margin of safety (expressed in units). 3.2 Use the marginal income ratio to determine the break-even value if the direct manufacturing costs are R10 per unit more than expected. 3.3 Calculate the total Marginal Income and Net Profit/Loss if the sales volume for 2023 is 20% below the budgeted quantity. 3.4 Calculate the number of units that must be sold to earn a net profit of R150 per unit. 3.5 Calculate the break-even quantity if the selling price is reduced by R50 per unit and the fixed manufacturing costs decrease by R22 000. INFORMATION The Salmon Ltd manufactures and sells fishing rods for R600 each. The budgeted sales for 2023 are 22 000 rods and the costs are expected to be as follows: Direct manufacturing costs per unit Variable manufacturing overheads cost per unit Variable administration costs per unit Sales commission Fixed manufacturing costs Fixed administration and selling costs R R200 R50 R40 10% of sales R1 800 000 R600 000
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