Question

(b) The cost particulars of a company for
year are as follows:
Variable cost
Rs. 50 per unit
Selling price
Rs. 125 per unit
Fixed cost
Rs. 1,61,250
(1) Calculate break-even point (units)
(ii) Determine the number of units
required to be sold and turnover
required by the company to each
profit of Rs. 45,000
​

Answer 1

Answer:

1) break even point= f/contribution

contribution = selling price- variable cost

125-50 = 75

bep = 161250/75 = 2150 in units

2) no of units that must be sold to earn profit of 45000= fixed cost+ profit

_________________

selling price per unit - variable cost

161250 +45000 / 75 = 2750 units