Pritam owns a glass factory and is in the business of making cups and glasses. He gets

an order to supply $20,000$ nos. of a specific type of glass. The variable cost to make the

glass totals to about Rs$.45$ per glass and the total fixed cost is Rs$.3,00,000.$

How should Pritam price his glasses under:

a$.$ Cost Plus Pricing to earn a profit of $10\%$

b$.$ Variable Cost Plus contribution to earn a contribution margin of $20\%.$

Compare the results and discuss under what situation each type will be beneficial.

Which of the two methods will Pritam choose if he has surplus capacity to manufacture

the glasses without incurring any additional fixed cost.