Raj Corporation Ltd has prepared the following budget estimates for the year 2016-2017:
Sales units
15000
Fixed expenses
34000
Sales value
shs.1,50,000
Variable costs
shs.6 per unit
You are required to:
1. Find the P/V ratio, Break-Even point and margin of safety.
2. Calculate the revised P/V ratio, Break-Even point and margin of safety in each of the following cases:
a) Decrease of 10% in selling price
b) Increase of 10% in variable units
c) Increase of sales volume by 2000 units
d) Increase shs. 6000 in fixed costs