Question

Datta Ltd. budgets for a production of 150,000 units. The variable cost per unit is 14 Rupees and the fixed cost per unit is 2 Rupees. The company fixed the selling price to fetch a profit of 15% on the cost price. What is the percentage of the profit/volume ratio? Answer in numeric form (in 2 decimal places)

Answer 1

Step-by-step explanation:

Selling Price Per Unit 18 Less : Variable Cost Per Unit 14 Contribution Per Unit 4 Fixed Cost = 150000 X 2 300,000 Break Even Point(in no. of units) = Fixed Cost/Contribuion Per Unit 75,000 units Workings :- Calculation of Selling Price Per Unit :- Variable Cost Per Unit 2,100,000 Fixed cost Per Unit 300,000 Total Cost 2,400,000 Add : Profit 15% of $2,400,000 360,000 Selling Price 2,760,000 No. of Units 150,000 Selling Price Per Unit 18 b.