Q.1) Emirates Steel Company reported the following accounting values:

Revenues	OR 4,500,500
Variable manufacturing costs	20.18% of revenue
Variable nonmanufacturing costs	18.09 % of revenue
Fixed manufacturing costs	14.50 % of revenue
Fixed nonmanufacturing costs	12.11 % of revenue

Required:

Part 1:

a. Compute contribution margin.

b. Compute contribution margin percentage.

c. Compute gross margin.

d. Compute gross margin percentage.

e. Compute operating income.

Part-2:

Write a note on the above retrieved ratios and give comments whether investment in the shares of M/s Emirates Steel Company is a prudent decision as an investor or not? In both cases, respond why you taken decision of Yes or No (give reasons)?

Q.2) Pepsi Cola Company wants to estimate the cost for each process. It is a beverage manufacturing unit and only produce different flavors of beverages.

Required:

a. Classify each of the following costs as either direct or indirect with respect to production process.

b. Classify each of the following costs as either fixed or variable with respect to Pepsi Cola Company per day.

	Direct	Indirect	Fixed	Variable
Admin & Security
Tools & Accessaries
Employee Wages
Employees Transportation
Plant & Machinery