Question

Manoj who manufactures a toy car using non-toxic components, wants to compute his break-even

point. Following is the detail available to him.

Salary: 45,000

Advertisement Expense: 20,000

Electricity: 30,000

Rent: 25,000

Insurance expense: 1,000

Raw Material (1000 unit): Rs 35, 00,000

Packing Material (1000 unit): Rs10, 00,000

Direct Overheads (1000 unit): Rs 700,000

Selling price per tyre: Rs 56,00

From the given information calculate:

(a) Variable cost

(b) Total Cost

(c) Break-even point in Units and in Rupees.​

Answer 1

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