MAC2601 Assignment 5
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 11
October 2024
CONTACT:
, MAC2601 Assignment 5 (COMPLETE ANSWERS)
Semester 2 2024 - DUE 11 October 2024
QUESTION 1 (15 Marks) (18 Minutes) Body Lotions (Pty)
Ltd manufactures one type of body lotion. You are
provided with the following costing information for the
quarter ended 30 September 2024, which is
representative of a typical quarter for the business: Total
Per unit (lotion) R R Sales Less: Variable costs
Contribution Less: Fixed expenses 180 000 Profit 15 000
REQUIRED Marks (a) Calculate the quarterly breakeven
point in units and Rand amount. (4) (b) Determine the
contribution margin at breakeven point. ( 2 ) (c) Calculate
the number of Body lotions that are needed to be sold in
each quarter to generate the quarterly target profit of
R60 000. (2) (d) Calculate the margin of safety in Rand
terms and percentage terms for the quarter ended 30
September 2024. (4) (e) By what percentage must Body
Lotions increase its selling price for its profit for the
quarter to increase by 100%? (2) (f) Define the term
contribution. (1) Total [15]
To solve the given problem, we'll break it down step by step:
Provided Information:
Sales = R180,000
Profit = R15,000
Fixed expenses = (not provided, but we'll calculate this)
Variable costs = (not provided, but we’ll calculate using the contribution and sales)
Formulae Needed:
1. Breakeven point (in units) = Fixed expensesContribution per unit\frac{\text{Fixed
expenses}}{\text{Contribution per unit}}Contribution per unitFixed expenses
2. Breakeven point (in Rands) = Breakeven units × Selling price per unit
3. Contribution margin per unit = Sales per unit - Variable cost per unit
(COMPLETE ANSWERS)
Semester 2 2024 - DUE 11
October 2024
CONTACT:
, MAC2601 Assignment 5 (COMPLETE ANSWERS)
Semester 2 2024 - DUE 11 October 2024
QUESTION 1 (15 Marks) (18 Minutes) Body Lotions (Pty)
Ltd manufactures one type of body lotion. You are
provided with the following costing information for the
quarter ended 30 September 2024, which is
representative of a typical quarter for the business: Total
Per unit (lotion) R R Sales Less: Variable costs
Contribution Less: Fixed expenses 180 000 Profit 15 000
REQUIRED Marks (a) Calculate the quarterly breakeven
point in units and Rand amount. (4) (b) Determine the
contribution margin at breakeven point. ( 2 ) (c) Calculate
the number of Body lotions that are needed to be sold in
each quarter to generate the quarterly target profit of
R60 000. (2) (d) Calculate the margin of safety in Rand
terms and percentage terms for the quarter ended 30
September 2024. (4) (e) By what percentage must Body
Lotions increase its selling price for its profit for the
quarter to increase by 100%? (2) (f) Define the term
contribution. (1) Total [15]
To solve the given problem, we'll break it down step by step:
Provided Information:
Sales = R180,000
Profit = R15,000
Fixed expenses = (not provided, but we'll calculate this)
Variable costs = (not provided, but we’ll calculate using the contribution and sales)
Formulae Needed:
1. Breakeven point (in units) = Fixed expensesContribution per unit\frac{\text{Fixed
expenses}}{\text{Contribution per unit}}Contribution per unitFixed expenses
2. Breakeven point (in Rands) = Breakeven units × Selling price per unit
3. Contribution margin per unit = Sales per unit - Variable cost per unit
