(a)[2]
Calculate the break-even point in units per month.
(b)[2]
Define ‘margin of safety’.
(c)[6]
Prepare a marginal costing statement showing the monthly profit after these changes.
(d)[4]
Explain two advantages of a marginal costing system.
(e)[2]
Calculate how many machine hours are available in August 2021.
(f(i))[4]
Calculate the profit or loss for August 2021 using Option 1.
(f(ii))[5]
Calculate the profit or loss for August 2021 using Option 2.
(g)[5]
Advise which option the company ought to pick. Justify your advice by discussing both options. (Take both financial and non-financial factors into account.)