Reference no: EM132119133

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

i. Determine the company's break even point to the nearest whole unit

ii. 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.

Products	Sales Budget (in units)
	Quarter 1	Quarter 2	Quarter 3	Quarter 4
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.