Professional Documents
Culture Documents
Independent University, Bangladesh
Independent University, Bangladesh
Independent University, Bangladesh
Submitted to:
Mr. Nafees reza
(School of business, IUB)
Submitted by:
Name: Humayon Ahmed Tamim
ID: 1921374
Table of Contents
1|Page
Answer 01:......................................................................................................................................3
Answer 02:......................................................................................................................................3
Answer 03:......................................................................................................................................3
Answer 04:......................................................................................................................................4
Answer 5A:.....................................................................................................................................5
Answer 5B:.....................................................................................................................................5
Answer 5C:.....................................................................................................................................5
Answer 5D:.....................................................................................................................................6
Answer 5E:.....................................................................................................................................6
Answer 5F:.....................................................................................................................................6
Answer 5G:.....................................................................................................................................7
Answer 5H:.....................................................................................................................................7
Answer 5I:......................................................................................................................................8
Answer 01:
Fixed cost of Aussie pie
2|Page
Details $
Rent 11900
Cooking Equipment 8000
Fixtures 5000
Salaries of Chefs 3600
Sales Assistance 1200
Lighting 300
TOTAL 30000
Answer 02:
Variable cost per unit of Aussie Pie
Details $
Food Supplies 1.2
Packaging 0.03
Utilities 0.02
TOTAL 1.25
Answer 03:
Monthly profit or loss of Aussie Pie for the sales of 6000 pies.
Details $
Sales (6000*3.25) 19500
Variable cost (6000*1.25) -7500
Fixed Cost -30000
NET LOSS 18000
Answer 04:
Details $
3|Page
Selling Price 3.25
Variable Cost 1.25
Fixed Cost 30000
CM per unit = Selling price per unit – Variable cost per unit
CM per unit= $3.25 - $1.25
= $2 per unit
= 15000 units
=$48750
Answer 5A:
Monthly fixed Manufacturing overhead cost to produce meat pies
Details $
4|Page
Chef Salary 3600
Rent 11900
Utility Bill 300
Equipment 8000
Fixture 5000
Supplies 200
TOTAL 29000
Answer 5B:
Monthly fixed selling and administrative cost
Details $
Rent 1000
Salaries executive salary 1200
Owners Salary 2000
Depreciation Cost 200
TOTAL 4400
Answer 5C:
Variable per unit cost of production of meat pies.
Details $
Raw materials 1.2
Utility Bill 0.03
TOTAL 1.23
Answer 5D:
Per unit selling and administrative cost
5|Page
Details $
Answer 5E:
= 22,267 UNIT
Answer 5F:
Margin of Safety (%) = (Actual Units- Break Even Point units)/ Actual Units X 100%
= 10.93%
Answer 5G:
Variable Costing: $1.25
6|Page
Absorption Costing:
Details $
Sales Revenues (25000*3.25) 81250
Variable Cost:
Variable COGS (25000*1.25) -30750
Variable selling & admin cost (25000*0.52) -13000
Contribution Margin 37500
Fixed Cost:
Fixed MOH -29000
Fixed Selling & admin -4400
NOI 4100
Answer 5H:
Reconciliation Statement
Details $
Variable Costing NOI 4100
FMOH differed in ending in absorption costing 1680
FMOH differed in beginning in absorption costing -590
5190
Answer 5I:
7|Page
The absorption costing method is better. Yes, a greater working income is proven because the
cure on closing stock and fixed MOH is fair within that method.
8|Page