Some examples from this set of practice questions
1.
What is break-even point formula in Rands and in units using the contribution method?
Answer: Break-even point in Units = Fixed cost ÷ Contribution per unit Contribution per unit= Sales per unit - Variable cost per unit Break-even point in Rands = Fixed cost ÷ Contribution margin ratio Contribution margin ratio= Total Contribution(rand) ÷ Total Sales(rand)
2.
What is the margin of safety ratio formula ?
Answer: Margin of safety (rands/units) ÷ Total Sales (rands/units) Margin of safety = Sales in units - Break-even point in units
3.
What is the target profit formula in units and in rands ?
Answer: Target sales in units = Fixed cost + profit (profit before tax) ÷ Contribution per unit Target sales in Rands = Fixed cost + profit (before tax) ÷ Contribution margin ratio Profit before tax = Profit after tax ÷ (1- tax rate) Contribution per unit = Sales per unit - Variable cost per unit Contribution margin ratio= Total Contribution(rand) ÷ Total Sales(rand)
4.
What is the operating leverage formula?
Answer: Degree of operating leverage = Contribution ÷ Net profit Contribution = Total Sales (rand) - Total Variable cost (rand) Net profit = Total Contribution(rand)- Fixed Cost (rand)
5.
What is the margin of safety percentage formula?
Answer: Margin of safety = Sales - Break-even Sales × 100 Break-even Sales in Rands = Fixed cost ÷ Contribution per unit Contribution per unit = Sales per unit- Variable cost per unit Break-even Sales in units = Fixed cost ÷ Contribution margin ratio Contribution margin ratio = Total Contribution (rand) ÷ Total Sales (rand)
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Stuvia is a marketplace, so you are not buying this document from us, but from seller willize. Stuvia facilitates payment to the seller.
No, you only buy these notes for $4.62. You're not tied to anything after your purchase.
4.6 stars on Google & Trustpilot (+1000 reviews)
57727 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now
