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A company produces only one product. Normal capacity is 20000 units per year and the unit sales price is Rs.5 relevant costs are: Unit Variable
A company produces only one product. Normal capacity is 20000 units per year and the unit sales price is Rs.5 relevant costs are:
| Unit Variable Cost | Total Fixed Cost |
Materials | Rs.1.50 |
|
Director labour | 1.20 |
|
Factory Overhead | 0.45 | Rs.15000 |
Marketing expenses | 0.35 | 5000 |
Administrative expenses |
| 6000 |
Required: Compute (2) break even point in units of product (2) break even point in sales (3) the number of units product that must be produced and sold to achieve a profit of Rs.10000 and (4) the sales revenue required to achieve a profit of Rs.10000. (20)
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