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EC Ltd (Kaplan Kit)

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › EC Ltd (Kaplan Kit)

  • This topic has 1 reply, 2 voices, and was last updated 4 years ago by John Moffat.
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    Posts
  • May 22, 2021 at 2:54 pm #621452
    simran98
    Participant
    • Topics: 23
    • Replies: 22
    • ☆

    Hello Sir

    Kindly help me with this question.

    Q) EC Ltd produces and sells the following two products throughout the year in a constant mix:

    Product X Product Y
    Variable cost per $ sales $0.45 $0.6
    Fixed costs $1212,000 per period

    The management of EC Ltd has stated that total revenues will reach a maximum of $4,000,000, and is generated by the two products in the following proportions:

    Product X Product Y
    Variable cost per $ of sales 70% 30%

    Required: calculate breakeven sales revenue based on the sales mix assumed above.

    Sir, I did not understand whether how we are taking 70% and 30% as sales mix when it is mentioned that it is the variable cost per $ of sales.

    Thank you for your help.

    May 23, 2021 at 10:11 am #621497
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54701
    • ☆☆☆☆☆

    I do not have the Kaplan Kit (only the BPP Revision Kit).

    It does seem from that you have typed that there is a typing error in the question and that it should say that the sales ratio is 70% 30% (and not the variable cost per $ of sales).

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