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MAC3701 Assignment 2 Semester 2 2023 (Answers) R50,00
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MAC3701 Assignment 2 Semester 2 2023 (Answers)

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MAC3701 Assignment 2 Semester 2 2023 (Answers) QUESTION 1 (100 Marks) EnerFizzCo Drinks Ltd (“EnerFizzCo”), situated in Dersley in the Gauteng Province, is one of the leading energy drink and effervescent tablet manufacturers in the East rand operating in a fiercely competitive market. ...

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  • August 29, 2023
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  • 2023/2024
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  • mac3701 assignment 2 semester 2 2023 answers

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,MAC3701 ASSIGNMENT 2 SOLUTIONS
(a) Calculate DrinkD’s budgeted break-even sales units per product type for the 2023 financial year. Ignore the implications, if any,
of opening- and closing inventory. (12)

To calculate the budgeted break-even sales units per product type for the 2023 financial year, we'll use the break-even formula:

Break-even Units=Fixed CostsSelling Price per Unit−Variable Cost per UnitBreak-
even Units=Selling Price per Unit−Variable Cost per UnitFixed Costs

From the provided budgeted information for DrinkD's 2024 financial year (which we'll use for 2023, assuming no drastic
changes), the following costs are stated:

For Streak:

Selling Price: R18.00
Prime Costs: R6.75
Variable Selling and Distribution Costs: R1.30
Fixed Manufacturing Overheads: R2.50
Variable Manufacturing Overheads: R0.65

For Glitzo:

Selling Price: R25.00
Prime Costs: R17.90
Variable Selling and Distribution Costs: R1.30
Fixed Manufacturing Overheads: R4.00
Variable Manufacturing Overheads: R1.25

Calculating the Variable Costs and Fixed Costs for Each:

For Streak:

Variable Cost per Unit = Prime Costs + Variable Selling and Distribution Costs + Variable Manufacturing Overheads = R6.75 +
R1.30 + R0.65 = R8.70
Fixed Cost per Unit = R2.50

For Glitzo:

Variable Cost per Unit = Prime Costs + Variable Selling and Distribution Costs + Variable Manufacturing Overheads = R17.90 +
R1.30 + R1.25 = R20.45
Fixed Cost per Unit = R4.00

Break-even Units:

For Streak:

Break-even Units for Streak=�2.50�18.00−�8.70=�2.50�9.30=268.82 unitsBreak-
even Units for Streak=R18.00−R8.70R2.50=R9.30R2.50=268.82 units

Rounding, that would be approximately 269 units.

For Glitzo:

Break-even Units for Glitzo=�4.00�25.00−�20.45=�4.00�4.55=879.12 unitsBreak-
even Units for Glitzo=R25.00−R20.45R4.00=R4.55R4.00=879.12 units

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