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ACC00724 - Accounting for Managers

Added on - 01 Nov 2021

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ACCOUNTING FOR MANAGERS
Contents
Solution 1:........................................................................................................................................3
Solution 2:........................................................................................................................................9
Bibliography..................................................................................................................................12
Solution 1:
The following data relates to Pacific Telemet Ltd. which is engaged in the manufacturing of high
end smart phones with dual sim cards. The following two tables give financial information about
the company from last year and also shows the profit that the company earned under current
situation[ CITATION Atk12 \l 1033 ].
Financial data from last year
Sales
12,0
00
Selling price
4
60
Variable manufacturing cost
1
84
Fixed manufacturing costs
3,60,0
00
Variable selling and administrative
costs

36
Fixed selling and administrative costs
6,00,0
00
Profit statement (under current circumstances)
ParticularsAmount
Sales
55,20,0
00
Less:
Variable manufacturing cost
22,08,0
00
Fixed manufacturing costs
3,60,0
00
Variable selling and administrative
costs
4,32,0
00
Fixed selling and administrative costs
6,00,0
00
Profit/Loss19,20,0
00
The calculations shown below provide us the information regarding profits under various
alternatives:
Alternative 1:
Proposal by David Groate
Sales
15,6
00
Selling price
4
60
Variable manufacturing cost
2
20
Fixed manufacturing costs
3,60,0
00
Variable selling and administrative
costs

36
Fixed selling and administrative costs
6,00,0
00
Advertisement charges
60,0
00
Profit statement
ParticularsAmount
Sales
71,76,0
00
Less:
Variable manufacturing cost
34,32,0
00
Fixed manufacturing costs
3,60,0
00
Variable selling and administrative
costs
5,61,6
00
Fixed selling and administrative costs
6,00,0
00
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