GCB1013/GDB2013 Oliver enterprise is a business producing potato chips. A new product called Spicy-Break, which...
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GCB1013/GDB2013 Oliver enterprise is a business producing potato chips. A new product called Spicy-Break, which was sold at RM1.90 per pack, had achieved the targeted sales of 300,000 units. The following data are the costs related to producing Spicy-Break: Variable cost: Direct materials Direct labour Manufacturing overhead Selling overhead RM0.85/unit RM0.25/unit RMO. 10/unit RMO. 10/unit The fixed costs incurred in producing 300,000 units of Spicy-Break were: Advertising cost Manufacturing overhead Administration overhead RM30,000 RM20,000 RM70,000 a. Calculate the contribution margin per unit for Spicy-Break [3 marks] b. Compute the breakeven point in units and Ringgit Malaysia (RM) for Spicy-Break [8 marks) C. Calculate how many units of Spicy-Break must be sold to achieve a target profit of RM450,000 [4 marks] d. If Oliver enterprise plans to include an additional flavour to Spicy-Break costing RMO. 15 per unit and increase the selling price by RM0.20 per unit, estimate the new breakeven point in units 15 marks]
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