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  • CVP Tutorial Questions Multi-Products

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    Alberto
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    NGS manufactures and sells treadmills, cross trainers, and rowing machines. The budget provides sales prices, volumes, costs for materials, labor, and variable overheads for each product. Labor costs are 60% fixed and 40% variable. General overheads are expected to be N$63,640. The requirements are to calculate the weighted average contribution to sales ratio for NGS and the margin of safety in N$ revenue.

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    CVP Tutorial Questions Multi-products (1)

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    NGS manufactures and sells treadmills, cross trainers, and rowing machines. The budget provides sales prices, volumes, costs for materials, labor, and variable overheads for each product. Labor costs are 60% fixed and 40% variable. General overheads are expected to be N$63,640. The requirements are to calculate the weighted average contribution to sales ratio for NGS and the margin of safety in N$ revenue.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
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    6 views1 page

    CVP Tutorial Questions Multi-Products

    Uploaded by

    Alberto
    NGS manufactures and sells treadmills, cross trainers, and rowing machines. The budget provides sales prices, volumes, costs for materials, labor, and variable overheads for each product. Labor costs are 60% fixed and 40% variable. General overheads are expected to be N$63,640. The requirements are to calculate the weighted average contribution to sales ratio for NGS and the margin of safety in N$ revenue.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    Question 2 (15 marks)

    Namibia Gym Sales (NGS) manufactures and sells three types of gym equipment: Treadmills (T),
    cross trainers (C) and rowing machines (R). The budgeted sales prices and volumes for the next year
    are as follows:
    T C R
    Selling price N$1 600 N$1 800 N$1 000
    Units 420 400 380

    The standard / (budgeted) cost card for each product is shown below:
    T C R
    N$ N$ N$
    Material 430 500 360
    Labor 220 240 190
    Variable overheads 110 120 95

    Labour costs are 60% fixed and 40% variable. General overheads excluding any fixed labour costs are
    expected to be N$63 640 for the next year.

    Requirement:
    a) Calculate the weighted average contribution to sales ratio for NGS. (4 marks)
    b) Calculate the margin of safety in N$ revenue for NGS. (3 marks)

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