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Accounting For Managers - Bonza Handtools ltd

   

Added on  2020-07-22

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ACCOUNTING FORMANAGERS
Accounting For Managers - Bonza Handtools ltd_1
Table of ContentsINTRODUCTION...........................................................................................................................1Question 1........................................................................................................................................11.1 if the increase in price and additional investment were made...............................................11.2 The improved quality of product could increase the sales volume.......................................11.3 promotion champagne by rebating all drills sold in 3 months..............................................2
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INTRODUCTIONAccounting for managers helps the professional heads of the organisation in making agood business decision. There can be implementation of various proposals or plans which can behelpful in improving the sales and profit of the entity (Salas and Campos, 2016). This can befruitful for the firm in securing optimum amount of reserves for the future. Bonza manufacturingLtd is adopting new changes with the help of its various managerial teams of several departmentswith the innovative ideas.Question 1Financial and other data of last 12 months for popular power drill for the home renovatormanufactured by Bonza Handtools ltd. The directors of this organisation wants to rise theprofitability of this product with this three suggestions.1.1 if the increase in price and additional investment were madeJan rossi the accountant of the Bonza Handtools ltd has increased the prices on selling is10$ per unit and believes that it will rise the profitability. And made additional expenses aboutpromotion of product through advertisements was of $125000.ParticularsunitsPrice/unitAmountSales20000$1402800000Variable cost of manufacturing20000$501000000Fixed manufacturing cost400000Total production4200000Variable sales and administrative cost/unit20000$30600000Fixes selling and administrative cost/unit300000Advertisement costs125000Total sales and administration1025000Total cost5225000Net Income (sales- total cost)375000Interpretation: It is to be interpreted that if the selling price is been increased to $10 per unit ofBonza Ltd (Renz, 2016). And also increasing the promotional expenses by $125000 as to securethe demand of the product in market. The organisation has earned $375000 of profit which hasrise of $75000. 1.2 The improved quality of product could increase the sales volume1
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