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Ndungula Ltd produces a single product. The company's estimated net profit for the coming year is as follows:
Sales N$750 000
Less: variable costs N$352 500
Contribution N$397 500
Less: Fixed costs N$225 000
Net profitN$172 000
Question 1: If the management of the company decides to give a 2% commission on all sales, what effect will this have on the break-even point in value (N$)?
Select one:
a. None of all
b. The break-even point in value would decrease by N$459 183.67.
c. The break-even point in value would decrease by N$34 655.37.
d. The break-even point in value would increase by N$34 655.37.
e. The break-even point in value would increase by N$459 183.67.
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