Question

Question Two (CL04) (12 marks) (30 minutes) Co Ltd is a Japanese public multinational corporation primarily known as a 2A - Honda Motor Co., Ltd is a of Honda Motor Co, draw a break-even chart total cost line, profit area, loss area, margin incidence. ufacturer of automobiles, motorcycles, and power equipment. From the following information draw a break-even chart and determine from the chart the break-even point, profit area, loss area, margin of safety, sales line, fixed cost line, and angle of (6 marks) Particulars Fixed Sales Direct wages Direct Variable overhead $180,000 overhead $200,000 material cost $260,000 $900,000 $220,000

Answer 1

		A	Direct Material Cost	$260,000
		B	Direct Wages	$220,000
		C	Variable Overhead	$180,000
		D=A+B+C	Total Variable Cost	$660,000
		E	Fixed Overhead	$200,000
		F=D+E	Total Cost	$860,000
		G	Sales	$900,000
		H=G-F	Profit	$40,000
				I	J	K	L=J+K	M=I-L
	Sales	Variable Cost	Percentage of Normal Sales	Sales	Variable Cost	Fixed Cost	Total Cost	Profit
	(60%*900000)	(60%*660000)	60%	$540,000	$396,000	$200,000	$596,000	-$56,000
	(70%*900000)	(70%*660000)	70%	$630,000	$462,000	$200,000	$662,000	-$32,000
	(80%*900000)	(80%*660000)	80%	$720,000	$528,000	$200,000	$728,000	-$8,000
			83.33%	$750,000	$550,000	$200,000	$750,000	$0	BREAKEVEN POINT
	(90%*900000)	(90%*660000)	90%	$810,000	$594,000	$200,000	$794,000	$16,000
	(100%*900000)	(100%*660000)	100%	$900,000	$660,000	$200,000	$860,000	$40,000
	(110%*900000)	(110%*660000)	110%	$990,000	$726,000	$200,000	$926,000	$64,000
	(120%*900000)	(120%*660000)	120%	$1,080,000	$792,000	$200,000	$992,000	$88,000
	(130%*900000)	(130%*660000)	130%	$1,170,000	$858,000	$200,000	$1,058,000	$112,000
	(140%*900000)	(140%*660000)	140%	$1,260,000	$924,000	$200,000	$1,124,000	$136,000
											COST VOLUME PROFIT GRAPH $1.400.000 o $1,200,000 o $1,000,000 o S800.000 o $600,000 o $400.000 o $200,000 o $0 0% 20% 40% 60% 80% 100% 120% 140% 160% -$200,000 o Sales Variable Cost Fixed Cost Profit Total Cost