Exam (elaborations)
MAC2601 Assignment 5 (COMPLETE ANSWERS) Semester 2 2024 - DUE 11 October 2024
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- University Of South Africa
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MAC2601 Assignment 5(COMPLETE ANSWERS)
Semester 2 2024 - DUE 11
October 2024
100% GUARANTEEEED
, 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]
Let's go through each part of the question step by step:
Given Data:
Profit: R15,000
Sales: R180,000 (Total)
Contribution: Not provided, but can be calculated.
Fixed expenses: Not provided directly, but can be calculated from the difference between
Contribution and Profit.
Let's break this down:
(a) Calculate the quarterly breakeven point in units and Rand amount.
We know that: Breakeven point in units=Fixed CostsContribution per unit\text{Breakeven point
in units} = \frac{\text{Fixed Costs}}{\text{Contribution per
unit}}Breakeven point in units=Contribution per unitFixed Costs
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