Q.No.1

Marks : 06

Spark Cafe charges is PKR 500 for a full buffet deal per person. The manager told that the variable expenses are PKR 250 per person and fixed cost is PKR 75000 per month. Compute the following:

1. Contribution Margin per unit
2. Contribution Margin Ratio
3. Breakeven point in unit
4. Breakeven point in PKR
5. Breakeven point in unit if they want Profit of PKR 25000
6. Breakeven point in PKR if they want Profit of PKR 95000

Q.No.2

Marks : 06

The KIA Motor Company estimated its factory overhead for the next period at Rs. 1,600,000. It is estimated that 80, 000 units will be produced at a normal material cost of Rs. 400, 000. Production will require 20,000 man hours at an estimated wage cost of Rs.800, 000. The machine will run about 40, 000 hours. Compute Applied FOH rate on the following basis.

1. Material Cost
2. Direct Labor Cost
3. Direct Labor Hours
4. Machine hours
5. Units of production
6. Prime cost