Attempt both questions. All questions carry equal marks. Maximum marks-10 Q1. The management of a company plans to drop one item from the product line and replace it with another. Given below are present cost and output data: Product Price (Rs.) School bag 60 Lunch box Water bottle 100 200 Variable Costs Per unit (Rs.) 40 60 120 Percentage of sales 30% 20% 50% Total fixed costs per year are Rs.7,50,000 and Sales are Rs.25,00,000. The change under consideration consists in dropping the line of Lunch box and including Books. If this change is made, the manufacturer forecasts the following cost and output data: Product School bag Books Water bottle Price Variable cost Percentage (Rs.) per unit (Rs.) of sales 60 40 50% 160 60 10% 200 120 40% Total fixed cost per year will be Rs.7,50,000 and Sales will be Rs.26,00,000. Should this proposal be accepted? Comment. Q2. Find out from the following data: (i) BEP in Rs. (ii) No. of units sold to earn profit of Rs. 60,000 p.a. Selling Price Rs. 20 per unit Variable manufacturing cost Rs. 11 per unit Variable Selling OH Fixed Factory OH Fixed Selling OH Rs. 3 per unit Rs. 5,40,000 per year Rs. 2,52,000 per year