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alysar2005
Oct 11, 2008, 12:31 AM
The unit production costs at a normal volume of 2000 units per month are :
Direct materials $15.00 per unit
Direct labour $28.00 per unit
Factory overhead $9.00 per unit
The factory overhead includes fixed overhead costs of $4 per units.

Variable selling expenses are $1 per unit and fixed selling and administration expenses total $2000 per month.

The unit selling price is $60.

Reuired:
a. Calculate expected monthly profit at the normal volume of 2000 units.
b. Determine the break-even sales volume in units and sales dollars.
c. Calculate the monthly sales volume in units and sales dollars to achieve net profit after tax of $14000 if the income tax rate is 30%.

Curlyben
Oct 11, 2008, 12:42 AM
Thank you for taking the time to copy your homework to AMHD.
Please refer to this announcement: Ask Me Help Desk - Announcements in Forum : Homework Help (https://www.askmehelpdesk.com/finance-accounting/announcement-font-color-ff0000-u-b-read-first-expectations-homework-help-board-b-u-font.html)

alysar2005
Oct 11, 2008, 12:57 AM
a. sales 120000
less variable man. Exp. 104000
D.m. 30000
D.L. 56000
FOH 18000 __________
Gross contribution margin 16000
Less variable oper. Exp. 2000
______
contribution margin 14000
Less fixed expenses 10000
FOH 8000
Selling & admin. 2000 ______
net profit 4000

b. $60-$53=$7
BE=10000/7=1429 per unit
1429 * 60= $85740
c. net profit before tax= 14000/(1-0.30)=
20000 per unit.
sales= 10000+20000/7=4286 per unit
4286 *$60= $257160

alysar2005
Oct 11, 2008, 01:08 AM
This is an assighment & I have done it by myself. I just want to check if my answer is right .