Informations regarding Sahani Ltd. are available as follows:

Rs.

Sales 2,00,000 Less: Variable Costs Contribution 1,50,000 Less: Fixed Costs 50,000 30,000 Profit Rs. 20,000 You are required to find out:

1.

P/V Ratio 2.

Profit on the sale of Rs. 3,00,000 3.

Required sales to earn a net profit ofRs, 30,000.

[Ans.: (1) P/V Ratio = 25% (2) B.E.P. = Rs. 1,20,000 (3) Net Profit on the Sale of Rs. 3,00,000 = Rs. 45,000 (4) Required sales to earn a profit of Rs. 30,000 = Rs. 2,40,000]

[Hint: (1) P/V Ratio =

SP — VC FC x 100; (2) B. E. P. =

FC P/V Ratio;

(3) Net Profit=Contribution Margin-FC; where, CM=PIV Ratio x Sales

(4) Sales =

CM P/V Ratio; where, CM = FC + Profit.]