Problem 1:

1. 160, 20%
2. 3,840K
3. 16K, 12,8M
4. 8K, 6.4M 33.33%
5. 3x
6. 853.33

%Change in Sales * DOL = %Change in EBIT

Rising Sales- Management Prefers higher DOL
Falling Sales - Management Prefers lower DOL

Fixed Cost in itself is risky

Problem No. 2
1. 2K
2. 9K
3. No
4. In units, decrease. In peso, no change.
5. (5K), 0, (5K)

Problem No. 3
1. 11.25K
2. 48K
3. 600K
4. 64K
5. 60K
6. 937.5K

Problem No. 4
1. 120K
2. 160K
3. 45
4.
a. 4,375 increase
b. 105K decrease
c. no effect
d. 175K increase

Problem No. 5
1. 30,000 ; 10,000 = FC/WA Selling Price
2. 750K ; 30K
To compute for the WAUCMR = WAUCM/WAUSP
Alternative computation of the WAUCMR = sum of (CM*Sales Mix in Peso) of
all products.
Total BEP (Units) = 390K/13 = 30K
Total BEP (Pesos) = 390K/.52 = 750K

3. BEP vs. Composite Break-even

BEP - number of units to break even.
Composite Break-even - it is assumed that you are selling products on a set
basis. Number of sets to break even.

Composite Break even (units) = FC/ Composite UCM

Composite UCM = contribution margin of 1 set
= sum of (CM * number of each product in one set) of all
products.
= (12*3) + (16*1)
 Composite UCM = 52

Composite Break Even = 390K/52

= 7500

*Needs to sell 7,500 sets to break even.

Alternative: (BEP/number of products in 1 set) (30K/4) = 7,500

Answer: 7,500

4. 780K
5. 110,00
6. 1,382,500

Production No. 6
1. Bruno
2. Bruno 100K
Berto 0
3. Bruno 800K
Berto 600K

Problem No. 7 (Revisit Discussion)

MCQ Problems:
1.