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Question - The HASF Ink Ltd income statement for the preceding year is presented below except as noted the cost / revenue relationship for the coming year is expected to follow the same pattern as in the preceding year income statement for the year ending March 31 is as follows
Sales (200,000 units @ 2.5 Each) Rs. 5,00,000
Variable cost 3,00,000
Contribution margin 2,00,000
Less Fixed cost 100,000
Profit before tax 100,000
Less tax 35,000
Profit after tax 65,000
Required - At what level of sales will the company be able to maintain its present pre- tax profit position even after expansion?
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This individual assignment is based on the TerraCycle Inc.
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A new plant accountant suggested that the company may be able to assign support costs to products more accurately by using an activity based costing system that relies on a separate rate for each manufacturing activity that causes support costs.
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