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Please provide step by step Solution with proper explanation and formulas. dort for the previous two years are as given below - (in Lakhs) Particulars
Please provide step by step Solution with proper explanation and formulas.
dort for the previous two years are as given below - (in Lakhs) Particulars Year 1 (for 5,000 units) Year 2 (for 6,000 units) Sales 30.00 39.60 Materials 12.50 15.75 Labour 6.00 7.92 Overheads Variable and Fixed) 7.00 25.50 8.70 32.37 Profit 4.50 Price Increase in Year 2 was due to Inflation and the same was applicable to Overheads also. The Management of the Company is of the view that Sales Volume Increase and Labour Cost Increase in Year 3 will be the same as seen in Year 2 compared with Year 1. As far as increase in Sales Price and other Cost Components are concerned, there are two views - (a) same increase will prevail, and (b) increase will be less by 2%. 7.23 Prepare the Budgeted Profitability for Year 3, taking both views (a) and (b) aboveStep by Step Solution
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