Question

(a) From the following data calculate :
(i)
P/V ratio
(ii) Variable cost and
(iii) Profit.
Rs.
Sales
80,000
Fixed expenses
15,000
Break even point
50,000

Answer 1

Answer:

answer

Step-by-step explanation:

Explanation:

Basic Marginal Cost  A company has an opening stock of 6,000 units of output. The production planned for the current period is 24,000 units and expected sales for the current period amount to 28,000 units. The selling price per unit of output is Rs.10. Variable cost per unit is expected to be Rs. 6 per unit while it was only Rs. 5 per unit during the previous period. What is the Break Even volume for the current period if the total fixed costs for the current period is Rs. 86,000? Assume that the first In first out system is followed. Assume that the Last in first out system is followed. SOLUTION:- Statement of Break Even Point (FIFO) Nature Quantity contribution per unit Total contribution Opening stock 6000 5/- 30,000 Current production 14,000 4/- 56.000 (B.f.) ∴ Break event point 20,000 unit fixed cost 86.000 Hence, Under FIFO System is covered by selling of 20000 units. There fore. The sale of 20.000 units is the break even point.statement of break event point (LIFO) Nature Quantity Contribution per unit Total contribution Current 21,500 4/- 4/- Opening stock - 5/- - 21.500 86.000 ∴ Break Even Point = 21,500 units .

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