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2. The expenses for budgeted production of 10,000 units in a factory are furnished below (Amounts in S) Per unit 70 25 20 10 Particulars

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2. The expenses for budgeted production of 10,000 units in a factory are furnished below (Amounts in S) Per unit 70 25 20 10 Particulars Material Labour Variable overheads Fixed overheads(1,00,000) Variable expenses (Direct) Selling expenses (10% fixed) Distribution expenses(20% fixed) Administration expenses(Rs.50,000) Total cost per unit 13 155 Prepare a budget a) For production of 8,000 units b) For production of 6,000 units c) Advise which level is profitable and suitable of the company ( Mark) Calculate the cost per unit at both levels Assume that administration expenses are fixed for all level of production (2 Marks) (2 Marks)

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