CASE STUDY

Illustration

A company has annual fixed cost of Rs. 1,68,00,000. In the year 2013-14, sales amounted to Rs.

6,00,00,000 as compared with Rs. 4,50,00,000 in the preceding year 2012-13. The profit in the year 2013-14 is

Rs. 42,00,000 more than that in 2012-13. On the basis of the above information, answer the following:

(i) What is the break-even level of sales of the company?

(ii) Determine profit/loss on the forecast of a sales volume of Rs.80,00,00,000

(iii) If there is a reduction in selling price by 10% in the financial year 2014-15 and company

desires to earn the same amount of profit as in 2013-14, what would be the required sales volume?

Question 1

"As per given information, what is the value of PV ratio?"

27%

28%

22%

25%

Question 2

"after reduction in selling price, the value of PV ratio will be ."

30%

20%

25%

27%

Question 3

What is the break-even level of sales of the company?

"500,00,000"

"840,00,000"

"600,00,000"

"80,00,000"

Question 4

"Contribution for Sales Volume of Rs. 800,00,000 is "

"56,00,000"

"10,00,000"

"200,00,000"

"224,00,000"

Question 5

"profit on the forecast of a sales volume of Rs. 80,00,00,000 is .."

"50,00,000"

"56,00,000"

"70,00,000"

"40,00,000"

Question 6

"Contribution for Sales Volume of Rs. 600,00,000 for the year 2013-14 is .."

"600,00,000"

"100,00,000"

"168,00,000"

"150,00,000"

Question 7

"If there is a reduction in selling price by 10% in the financial year 2014-15 and company desires to earn the same amount of profit as in 2013-14, what would be the required sales volume?"

"840,00,000"

"100,00,000"

"800,00,000"

"70,00,000"

Question 8

Change in Profits/ Change in Sales =

Contribution

PV Ratio

None

EPS

Question 9

P/V Ratio Sales = ..

Contribution

None

Profits

Net Sales

Question 10

Contribution Fixed costs= ..

Sales

Profits

PV Ratio

None