7/26/2019 ACC501

1/5

MBA Intake 1

ACC501 Business Accounting & Finance

ASSIGNMENT 1

Question 1

A.

Contribution Margin per Unit= 180 - (22 + 35 + 15 + (10% x 180))

= 180 90

= $90

Contribution Margin Ratio =Contribution Margin per Unit

Unit Selling Price x100=

90

180x 100=50

Q break-even point =Total i!e" Co#t#

Contribution Margin per Unit=

1$1%5$000

90 =1%$500(Units)

Sale# break-even point =Total i!e" Co#t#

Contribution Margin Ratio=

1$1%5$000

50 =$ %$%50$000

B.

Q Target &et 'nco(e =Total i!e" Co#t# ) Target &et 'nco(e

Contribution Margin per Unit =

1$1%5$000+*+$00090

=1+$%00(Units )

Margin o !aet" (in Unit!) = 13#200 12#500 = 00 (Unit!)

Margin o !aet" (in o&&ar!) = (13#200 x 180) 2#250#000 = $12'#000

C.

Contribution Margin at a !e&&ing prie o $180 ea an !e&& 1'#000 pair!

Contribution Margin = 1'#000 * $90 = $1#0#000

Contribution Margin at a !e&&ing prie o $1'0 ea an !e&& 19#000 pair!

7/26/2019 ACC501

2/5

Contribution Margin per Unit = $1'0 ($22+$35+$15+$1') = $2

Contribution Margin at a !e&&ing prie o $1'0 = ,uantit" x Contribution Margin per Unit = 19#000 x

$2 = $1#3'8#000

Conclusion: Co!an" sells 1#$000 !ai%s at a selling !%ice o '1(0 eac) *ette% t)an t)e co!an"sells 1+$000 !ai%s

,.

e.uire /a&e! in o&&ar! = ($1#125#000 + $'3#20) + $3'#00050% = $2#8#50

E.

et inoe beore tax = $3#800(100%-30%) = $5#000

e.uire /a&e! in Unit! = ($1#125#000 + $5#000) $90 = 13#100 (unit!)

7/26/2019 ACC501

3/5

Question -

a/

Materia&! 4rie ariane = 6tua& ,uantit" x 6tua& 4rie 6tua& ,uantit" x /tanar 4rie

= 10#'00 x $2725 10#'00 x $2#10

= '1$5+0

Materia&! ,uantit" ariane = 6tua& ,uantit" x /tanar 4rie /tanar ,uantit" x /tanar 4rie

= 10#'00 x $271 10#000 x $2#10

= '1$-#0

Total Mate%ials a%iance = Materia&! 4rie ariane + Materia&! ,uantit" ariane

= 1#590 + 1#2'0

= '-$(50

abor 4rie ariane = 6tua& our! x 6tua& ate 6tua& our! x /tanar ate

= 1#00 x ($120#9'0 1#00) 1#00 x ($120#000 15#000)

= '5$2#0

abor ,uantit" ariane = 6tua& our! x /tanar ate /tanar our! x /tanar ate

= 1#00 x ($120#000 15#000) 15#000 x ($120#000 15#000)

= -'3$(00 F

Total 4a*o% a%iance = abor 4rie ariane + abor ,uantit" ariane

= 5#'0 - #800

= '+#0

*/

:ota& ;

7/26/2019 ACC501

4/5

Question

a/

Make Bu"

Net Incoe

Inc%ease

,ec%ease/

iret &abor ($1#0) '0#000#000 '0#000#000

iret ateria& ($1#) 8#000#000 8#000#000

ariab&e ator" o

7/26/2019 ACC501

5/5

:e opan" !ou& aept te !peia& orer7

B.

4roit inrea!e = (120 55) x 12#000 = $80#000

en te opan" aept! te orer # it! proit! >ou& inrea!e b" $80#000