Reference no: EM132560692

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.