This is pretty much the same from my point of view, but some questions may sound a little weird to you ... If you practice the Wiley or Glim (average 1750 questions) questions at least a couple of times it won't bother you
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ARUN PARAMBATH
Analyst
Doha
Qatar
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Original Message:
Sent: 06-20-2021 09:04 AM
From: HARNEET KAMBOJ
Subject: Part 2 Section C - Pricing
I just wanted to ask that anyone who has given exam recently of part 1 can tell what is the level of exam and they are the same way which Willey and gliem provide questions or not.
Thanks
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HARNEET KAMBOJ
Accountant
JALANDHAR
India
Original Message:
Sent: 06-19-2021 05:31 AM
From: Edna Gonsalves
Subject: Part 2 Section C - Pricing
I have a Life cycle of Product costing question
tY-Connections a China based firm has just developed ultra-thin tablets S-5 with few features like the ability to open two apps at the same time.This tablets cost $500000 to develop; it has undergone extensive research and is ready for production. Currently the firm is deciding on plant capacity, which could cost either $35,00,000 or $52,00,000. The additional outlay would allow the plant to increase capacity from 500 units to 750 units. The relevent data for the life cycle of the tablet at different capacity level are as under:
Expected Sales 500 units 750 units
Sale Price per unit ₹ 79,600. 69,600
Variable Selling
cost 10% of Selling Price 10% of Selling Price
Salvage Value -Plant ₹ 6,25,000 ₹ 9,00,000
Profit Volume Ratio 40%. -
Required:
Advise Y-Connections regarding the optimal plant capacity to install. The tablet life cyle is 2 years. Ignore the time value of money.