A textile company has 20 machines. The annual aggregate output produced by these machines is
Rs. 200,000. Annually, the company pays Rs. 20,000 for raw material and Rs. 100,000 as
infrastructure costs. The company pays 10 % of the profit to its shareholders. How much profit will
the company pay to its shareholders if two machines break down and have not been used for a year? /
Answers
Given : A textile company has 20 machines. The annual aggregate output produced by these machines is Rs. 200,000.
Annually, the company pays Rs. 20,000 for raw material and Rs. 100,000 as infrastructure costs.
The company pays 10 % of the profit to its shareholders.
To Find : How much profit will the company pay to its shareholders if two machines break down and have not been used for a year?
Solution:
A textile company has 20 machines.
The annual aggregate output produced by these machines is Rs. 200,000.
Annually, the company pays Rs. 20,000 for raw material
=> raw material annually per machine = 20000/20 = Rs 1000
output produced per machine = 200,000. / 20 = Rs 10000
if Two machines are break down and have not been used then 18 machines used
raw material = 18 * 1000 = 18000
output produced = 10,000 * 18 = Rs 180000
Rs. 100,000 as infrastructure costs. is fixed
Total cost = 18000 + 100000 = 118000
Total output = 180000
Profit = 180000 - 118000 = 62000 Rs
. The company pays 10 % of the profit to its shareholders.
= (10/100) 62000 = 6200 Rs
company pay to its shareholders = 6200 Rs
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