Reference no: EM132117328

Questions -

Q1. The following information is showing company peter's Ltd revenue and advertising costs over 5 years

	1	2	3	4	5
Sales revenue	700	830	820	530	790
Advertising cost	430	460	470	400	380

The company's revenue for year's 6 and 7 are as follows: 960/= and 1000/=. How much is the company expected to spend on advertisement?

Q2. Peter's consulting company Ltd sell a single product. In the coming month, it is budgeted that this product will generate a total revenue of Kshs. 300000 with a contribution margin of Kshs. 125000. Fixed costs are budgeted at Kshs. 100,000 for the month. Calculate the margin of safety.

Data concerning Brian limited's single product is as follows:

Selling price 6

Variable production cost 1.2

Variable selling cost 0.4

Fixed production cost 4.00

Fixed selling cost 0.80

The budgeted production and sales for the year are 10,000 units.

Required -

Determine the company's breakeven point to the nearest whole unit

Using contribution margin ratio determine the sales value at breakeven point

Q3. Tina enterprises sell two products X and Y. during the year 2014, it plans to sell the following quantities of each product.

Sales budget (in units)

Products quarter1 quarter2 quarter3 quarter4

X 9000 2300 3000 8000

Y 8500 7500 5500 8500

Each of these two products is sold on a seasonal basis. Product A tends to sell better in summer months, while product B sells better during winter. X is sold at sh. 10 per unit while Y at a price of sh. 20 per unit throughout the year.

A study of the past experience reveals that Tina's enterprise has lost about 3% of its invoice each year because of returns( constituting 2% loss of revenue) allowances and bad debts (1 % loss)

Required - Prepare a sales budget incorporating the above information.