UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

Tutorial 8 - Question 2
Monarch Ltd
Operating statement (draft budget, 60,000 units sold)
RM
Sales (1,800,000 / 60,000unit = RM30 per unit)
(-) Marginal cost
Direct materials
Direct labour
Variable overhead

480,000
240,000
240,000

Contribution
(-) Fixed cost
Production
Gross profit
(-) Administration expenses
(-) Selling and distribution cost
Net profit

Monarch Ltd
Operating statement (suggestion i, 78,000 units sold)
RM
Sales (60,000 x 1.3) x (RM30 x 0.9)
(-) Marginal cost
Direct materials (RM8 x 0.9375 x 60,000 x 1.3)
Direct labour (4 x 60,000 x 1.3)
Variable overhead (60,000 x 1.3 x 4)

585,000
312,000
312,000

Contribution
(-) Fixed cost
Production
Gross profit
(-) Administration expenses
(-) Selling and distribution cost
Net profit

Monarch Ltd
Operating statement (suggestion ii, 62,000 units sold)
RM
Sales
(-) Marginal cost
Direct materials
Direct labour
Variable overhead
Contribution
(-) Fixed cost
Production

496,000
248,000
248,000

UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

Gross profit
(-) Administration expenses
(-) Selling and distribution cost (100,000 + 15,000 + 12,000)
Net profit

UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

Monarch Ltd
Operating statement (suggestion iii, 75,000 units sold)
RM
Sales (60,000 x 1.25) x 30
(-) Marginal cost
Direct materials (8 - 0.3) x 75,000
Direct labour
Variable overhead

577,500
300,000
300,000

Contribution
(-) Fixed cost
Production
Gross profit
(-) Administration expenses
(-) Selling and distribution cost (100,000 + 40,000 + 7,000)
Net profit

Monarch Ltd
Operating statement (suggestion iv, selling price = RM29)
RM
Selling price per unit
Sales unit (60,000 x 1.3)
Sales value
(-) Marginal cost
Direct materials (8 x 0.9375 x 78,000)
Direct labour
Variable overhead
Contribution
(-) Fixed cost
Production
Gross profit
(-) Administration expenses
(-) Selling and distribution cost
Net profit

585,000
312,000
312,000

UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

Breakeven quantity
RM
1,800,000

Contribution/unit

Total fixed cost

Contribution/unit

(960,000)
840,000

14.00

(260,000)
580,000
(90,000)
(100,000)
390,000

450,000
14.00
32,143
units

Breakeven quantity
RM
2,106,000

Contribution/unit

Total fixed cost

Contribution/unit

(1,209,000)
897,000

11.50

(290,000)
607,000
(95,000)
(110,000)
402,000

495,000
11.50
43,043
units

Breakeven quantity
RM
1,860,000

Contribution/unit

Total fixed cost

Contribution/unit

(992,000)
868,000
(260,000)

14.00

477,000
14.00

UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

608,000
(90,000)
(127,000)
391,000

34,071
units

UKMM1043 BEAMTutorial 7 (Suggested Answer)Page 5 of 5

Breakeven quantity
RM
2,250,000

Contribution/unit

Total fixed cost

Contribution/unit

(1,177,500)
1,072,500

14.30

(285,000)
787,500
(94,000)
(147,000)
546,500

526,000
14.30
36,783
units

Breakeven quantity
RM
29.00
78,000
2,262,000

Contribution/unit

Total fixed cost

Contribution/unit

(1,209,000)
1,053,000
(327,000)
726,000
(90,000)
(150,000)
486,000

13.50

567,000
13.50
42,000
units