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4G. OK/ SE 17:17 32% Edit 50 x Question 4 (This question has four items, al, (b), (c), and (dl) (6 + 3 + 3 + 2 = 14 marks) XYZ Ltd plans to sell 120.000 units at a selling price of $15 per unit. The company has collected the following information for its first year of operations: Sales $1.800.000 Selling expenses (40% variable and 60% fixed 240.000 Direct materials 511.000 Direct labou 285.000 Administrative expenses 120% variable and 80% fixed 280.000 Manufacturing overhead (70% variable and 30% fixed 360.000 The managing director of the company has asked that you undertake a cost- volume-profit ICVP) analysis to assist with planning Required (a) Calculate the breakeven point in units for the first year of operations. (6 marks) Suggested Answer Click or tap here to enter text. (Or, you can use the given excel document to show your work for this question.) (b) XYZ Ltd has set a target profit net income of $260.000 for next year. What Page 7 of 12 BLACC 9993 Cost and Management Accounting Semester 1 2020 is the required sales in dolars for the company to achieve this target? (Assume that selling price, variable costs per unit and fored costs will remain the same as for the first year of operations. [3 marks) Suggested Answer: Click or tap here to enter text (Or, you can use the given excel document to show your work for this question) (c) Assuming that the company meets its target profit net income) for next year. what will be its Margin of Safety Ratic? 13 marks) Suggested Answer Click or tap here to enter text (Or, you can use the given excel document to show your work for this question (d) In terms of the degree of operating leverage, the management claims that the higher degree of coeratina leverage, the batter Do you agree or DO סם Tools Mobile View Share Edit on PC = כ