Given:

Sales Rs. 5,00,000 Variable Costs Rs. 3,75,000 Gross Profit Rs. 1,25,000 Fixed Costs Rs. 37,500 Net Profit Rs. 87,500 Calculate: (

i) P/V Ratio; (ii) B.E.P.; (iii) Net Profit when sales are Rs. 7,00,000; (iv) Margin of Safety when sales are Rs. 6,00,000; (

v) Sales required to earn a profit of Rs. 1,00,000;

(vi) Additional sales required to cover an increase of Rs. 4,000 annual in the sales manager’s salary.

[Ans.: (

i) 25%; (ii) Rs. 1,50,000; (iii) Rs. 1,37,500;

(iv) Rs. 4,50,000; (

v) Rs. 5,50,000; (vi) Rs. 16,000.]