cvp analysis case solution

1. GROUP 6

2. Chocolate Candy Coffee Candy
Production
Sales
3.000.000 packs
3.000.000 packs
2.000.000 packs
3.000.000 packs
Production cost
Direct materials cost $1.5 $ 1.25
Direct labor cost 1 1
Variable factory OH cost
Fixed factory OH cost
Total cost
Variable marketing & adm
Fixed cost
Direct fixed cost
Common fixed cost
Both candy 6.500.000
0.5
0.75
$ 3.75
$ 2
$ 750.000
0.25
0.5
$ 3
$ 1
$ 500.000

3. Chocolate candy sales
Coffee candy
3.000.000 = 3/2
2.000.000

4. product Price/uni
t
Variable
cost
Contribution
margin
Sales
mix
Total CM
Chocolate
candy
$ 10 5 5 3 15
Coffee
candy
TOTAL
$15 4 3.5 2 7
22
BEP=TOTAL FC = (750.000+500.000+6.500.000) = 7.750.000= 332.273 pc
TOTAL CM 22
22
SALES BEP
CHOCOLATE CANDY = 3 x 332.273 = 1.056.819 pc
COFFEE CANDY = 2 x 332. 273 = 704. 346 pcSales mix

5. BEP = Total FC + Targeted profit bf tax
CM/unit
= (7.750.000 + 2.200.000)/22
=9.950.000/22= 452.273 pc
Chocolate candy = 1.356.819 pc
3 x 452.273
Coffee candy = 904.546 pc
2 x 452.273

6. CHOCOLATE
CANDY
COFFEE CANDY TOTAL
SALES 10.568.190 5.284.095 15.852.285
VARIABLE COST (5.284.095) (2.818.184) (8.102.279)
CONTRIBUTION
MARGIN
5.284.095 2.465.911 7.750.006
LESS DIRECT
FIXED COST
(750.000) (500.000) (1.250.000)
PRODUCT
MARGIN
4.534.095 1.965.911 6.500.006
COMMON FIXWD
COST
(6.500.000)
OPERATING
INCOME
0

7. In Pack = 22.11 % x 452. 2773
= 99.998 packs
Its mean if the salesvolume decrease 22.11 % of the
expected volume then sales will bw break even point . In
other word a decrease in sales that can still be tolerated so
company not get loss as high
MoS = Xe-Xb x 100%
Xe
= (452.273-352.273) x 100%
423.273
=22.11 %