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In 2018, LINA Sdn Bhd made a sale of $2,000,000 for three of its products X, Y, and Z with a sales mix of 50%, 20% and 30% respectively. The fixed...

In 2018, LINA Sdn Bhd made a sale of $2,000,000 for three of its products X, Y, and Z with a sales mix of 50%, 20% and 30% respectively. The fixed cost is $ 30,000 per month.


Product X Y Z

Total cost/unit ($) 38 50 40

Fixed cost/unit 25% of total cost 20% of total cost 30% of total cost

Sales price/unit ($) 40 55 45 

 

Required:

a. Determine the company's break-even point (in sales value) and margin of safety (in sales value) for the year.

b. The projected sales for the following year for products X, Y, and Z are $800,000, $500,000 and $900,000 respectively. Calculate the revised break-even point (in sales value) 

Top Answer

A) breakeven = 1156678.7 and... View the full answer

breakeven par 1.png

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2 comments
  • References :- https://corporatefinanceinstitute.com/resources/knowledge/finance/margin-of-safety-formula/
    • Zain.Rajani
    • Aug 01, 2018 at 9:27am
  • References :- https://www.accountingformanagement.org/break-even-analysis-with-multiple-products/
    • Zain.Rajani
    • Aug 01, 2018 at 9:27am

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