Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Consider the following information related to a manufacturing company. Rs. (per unit) Selling Price 100.00 Variable costs Direct Material 30.00 Direct Labour 30.00 Variable overhead

image text in transcribed

Consider the following information related to a manufacturing company. Rs. (per unit) Selling Price 100.00 Variable costs Direct Material 30.00 Direct Labour 30.00 Variable overhead 20.00 Fixed costs are estimated at Rs.100,000/- for the year and the company expects to sell 10,000 units during the year. You are required to calculate (a) Contribution Sales (C/S) Ratio. (b) Sales at the break-even point, (03 marks) If the fixed costs increase by Rs.10,000/- and sales and variable cost remain unchanged. compute the new breakeven point (02 marks) (iv) The company is considering a proposal to modernize its existing plant. This will need additional fixed cost of Rs.25000/- with the expectation of saving Rs.2.50 each from direct material costs and direct labour costs need to produce a unit. If this proposal is undertaken, compute (a) Contribution Sales Ratio (b) Break-even point (c) Profit of the company after modernizing (05 marks)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

MP Auditing And Assurance Services W/ACL Software CD ROM A Systematic Approach

Authors: William Messier Jr, Steven Glover, Douglas Prawitt

9th Edition

1259162346, 978-1259162343

More Books

Students also viewed these Accounting questions

Question

9. Describe the characteristics of power.

Answered: 1 week ago

Question

3. Identify and describe nine cultural value orientations.

Answered: 1 week ago