Hi could someone please answer these questions ? Thanks!
markblake
Registered Posts: 2
Summerseat Garden Centre manufactures wooden garden chairs and has the following details of the cost of each chair.
Material Cost: Wood £12.50
Metal fittings £7.25
Variable overheads per chair £4.50
Labour hours per chair Assembly 2 hours
Finishing 1 hour
Assembly labour costs £7.50 per hour and finishing labour is £6.25 per hour. Demand is expected to be 2,400 chairs per year selling at £70 per chair.
Fixed overheads are expected to be £45,000 and this includes depreciation of £9,000.
What would be the operating profit, breakeven point and margin of safety if actual demand exceeds expected demand by 10% but selling price falls by 10%.
Select one:
A.£23,040 1429 chairs 34%
B.£22,800 1469 chairs 63%
C.£1,200 2571 chairs 3%
D.£13,080 2045 chairs 22.5%
E.£1,800 2057 chairs 7.7%
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Curtley Ltd manufactures cricket balls. The forecasted income statement for the year, before any special orders, is as follows:
Total Per Unit
(£000’s) £
Sales 4,400 11.00
Manufacturing COGS 3,200 8.00
Gross Profit 1,200 3.00
Selling Expenses 300 0.75
Operating Income 900 2.25
Fixed costs included in the above statement are £1,200,000 in manufacturing COGS and £100,000 in selling expenses. A special order for 50,000 cricket balls for £7.50 each has been received from Balls’R Us Sports Shops. Curtley has sufficient capacity to take this order and there will be no additional selling expenses. By how much would operating income be affected if the order was accepted?
Select one:
A. £100,000 increase
B. £125,000 increase
C. £25,000 decrease
D. £62,500 decrease
E. £112,500 increase
Material Cost: Wood £12.50
Metal fittings £7.25
Variable overheads per chair £4.50
Labour hours per chair Assembly 2 hours
Finishing 1 hour
Assembly labour costs £7.50 per hour and finishing labour is £6.25 per hour. Demand is expected to be 2,400 chairs per year selling at £70 per chair.
Fixed overheads are expected to be £45,000 and this includes depreciation of £9,000.
What would be the operating profit, breakeven point and margin of safety if actual demand exceeds expected demand by 10% but selling price falls by 10%.
Select one:
A.£23,040 1429 chairs 34%
B.£22,800 1469 chairs 63%
C.£1,200 2571 chairs 3%
D.£13,080 2045 chairs 22.5%
E.£1,800 2057 chairs 7.7%
-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Curtley Ltd manufactures cricket balls. The forecasted income statement for the year, before any special orders, is as follows:
Total Per Unit
(£000’s) £
Sales 4,400 11.00
Manufacturing COGS 3,200 8.00
Gross Profit 1,200 3.00
Selling Expenses 300 0.75
Operating Income 900 2.25
Fixed costs included in the above statement are £1,200,000 in manufacturing COGS and £100,000 in selling expenses. A special order for 50,000 cricket balls for £7.50 each has been received from Balls’R Us Sports Shops. Curtley has sufficient capacity to take this order and there will be no additional selling expenses. By how much would operating income be affected if the order was accepted?
Select one:
A. £100,000 increase
B. £125,000 increase
C. £25,000 decrease
D. £62,500 decrease
E. £112,500 increase
0
Comments
-
units 2400 2640
sales@70 168000 166320
materials@12.50 30000 33000
metal@7.25 17400 19140
variable overheads@4.5 10800 11880
labour@15 36000 39600
assembly@6.25 15000 16500
cost of sales 109200 120120
gross profit 58800 46120
fixes cost 45000 45000
profit 138000 1200
63-12.5-7.25-4.5-15-6.25=17.50
45000/17.5= 2571
2640-2571/2640=3%
i think the answer is C
number of units 400 400
50
sales rev 4400 4400
375
fixed cost 1200 1200
variable cost 2000 2225
gross profit 3200 1350
non product fixed 100 100
non product variable 200 225
profit 900 1025
1025000 - 900000 =125000
i think the answer is B
i hope this helps0
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