(a) M Ltd. has started a new venture of manufacturing cotton shirts. The company wants to analyze whether the costing of finished goods is done correctly taking into account all the expenses incurred for which it provides you with the following information.

Calculate the cost of goods sold from the given information.

Particular

Prime Cost 198000 Cost of Opening stock of finished goods 48000

Factory overheads 32000 Cost of Closing stock of Finished goods 26000

(b) X Ltd. is evaluating the profitability of its manufacturing business by adopting the Marginal Costing technique. To evaluate the same, it provides you with the following costs and sales related information:

Variable cost Fixed cost Net profit Sales

240000 60% 1 20000 30% 40000 10%. 400000 100%

You are required to find out:

(i) Break-even point

(ii) P/V ratio