Question
Ex. 5. A factory is currently working to 50% capacity and produces 10,000 units. Estimate the profits of the company when it works at 60%
Ex. 5. A factory is currently working to 50% capacity and produces 10,000 units. Estimate the profits of the company when it works at 60% and 80% capacity and offer your critical comments. At 60% working raw material cost increases by 2% and selling price falls by 2%. At the 80% working, raw material cost increases by 5% and selling price falls by 5%. At 50% capacity working the product costs 180 per unit and is sold at 200 per unit. The unit cost of 180 is made up as follows: Material Labour Factory Overhead Administrative Overhead [Ans. 2,00,000; 2,12.000 :2.12.0001 100 30 30 (40% fixed) 20 (50% fixed)
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