Selasih Company manufactures aluminium containers for restaurants. The owner of Selasih, Puan Atiqah, believes that an aggressive campaign is needed next year due to the Malaysian local market’s...

Selasih Company manufactures aluminium containers for restaurants. The owner of Selasih, Puan Atiqah, believes that an aggressive campaign is needed next year due to the Malaysian local market’s uncertain conditions. Presented below is the data for the current year 2021, for use in next year’s campaign.

Puan Atiqah has set the sales target for the year 2022 at a level of RM550,000 (22,000 units of containers), or ten percent more than the sales in the year 2021. The selling price of the container is RM25 each, for both years.

Required:

1. “Break-even analysis is of limited use to management because a company cannot survive by just breaking even.” Do you agree with the statement? Explain.