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QUESTION 2 ABC Company has the following data for the month of May 2019: Cost Schedules Variable costs Direct labor per unit OMR 5.00 Direct materials 3.00 Variable overhead 1.00 Variable cost per unit 9.00 Fixed costs Manufacturing OMR 110,500 Marketing 64.000 Administrative 45,500 Total fixed costs 220,000 Selling price per unit OMR 20 Requirements: a. Compute break-even point in units using the mathematical equation. (Rubric: 0.5 mark for the correct formulas, 0.5 mark for the calculations and 0.5 for the correct answer. Total = 1.5 marks) b. Compute break-even point in sales rials using the contribution margin (CM) ratio. (Rubric: 0.5 mark for the correct formulas, 0.5 mark for the calculations and 0.5 for the correct answer. Total = 3 marks) c. Compute the margin of safety percentage assuming actual sales are OMR 500,000. (Rubric: 0.5 mark for the correct formulas, 0.5 mark for the calculations and 0.5 for the correct answer. Total - 1.5 marks) d. Compute the sales required in rials to earn net income of OMR 165.000 (Rubric: 0.5 mark for the correct formulas, 0.5 mark for the calculations and 0.5 for the correct answer. Total = 1.5 marks) e. Compute the sales required in rials to earn net income of OMR 165,000 if the variable cost per unit has increased to 11 OMR and total fixed cost has increased to 250,000. (Rubric: 0.5 mark for the correct formulas, 0.5 mark for the calculations and 0.5 for the correct answer. Total = 2 marks)

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