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Your company want to know how many units they'd have to sell this season to break even. However, you have some reservations over whether or not breakeven analysis is suitable for the company.

Which of these assumptions over product range limit the accuracy of break even analysis? Select ALL that apply.

Options:

The company only sells one product

The company has a consistent selling ratio across all products

The company sells multiple products

Variable costs remain consistent at any level of production

Fixed costs remain the same regardless of activity

The company has a variable selling ratio across all products

Prices and demand of products will remain steady

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Question 2

MDS is facing a temporary shortage of Material H which is used to produce all three of its products.

In order to maximise its profitability, which product should be manufactured first?

Options:

The product using the least amount of Material H per unit.

The product with the highest contribution per kg of Material H.

The product with the highest contribution per unit.

The product with the highest profit per unit.

Question 3

Two products being produced by a company require the same material which is limited to 2,600 kgs.

What is the optimal production plan?

Options:

500 units of S & 100 units of T

50 units of S & 400 units of T

400 units of S & 167 units of T

500 units of S & 400 units of T

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