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Smu Assanment

The document provides calculations to determine (A) the break-even point expressed in terms of sales amount and (B) the number of units that must be sold to earn a profit of Rs. 60,000 per year. It is given that the sales price per unit is Rs. 20, total variable cost per unit is Rs. 14, and total fixed costs per year are Rs. 7,92,000. It then calculates that (A) the break-even point in terms of sales amount is Rs. 26,40,000 and (B) the number of units that must be sold to earn a profit of Rs. 60,000 is 1,42,000 units.

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shailesh
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283 views2 pages

Smu Assanment

The document provides calculations to determine (A) the break-even point expressed in terms of sales amount and (B) the number of units that must be sold to earn a profit of Rs. 60,000 per year. It is given that the sales price per unit is Rs. 20, total variable cost per unit is Rs. 14, and total fixed costs per year are Rs. 7,92,000. It then calculates that (A) the break-even point in terms of sales amount is Rs. 26,40,000 and (B) the number of units that must be sold to earn a profit of Rs. 60,000 is 1,42,000 units.

Uploaded by

shailesh
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Q.

6 From the following data calculates the:-

(A) Break-even point expressed in terms of sale amount/revenue.

(B) Number of units that must be sold to earn a profit of Rs. 60, 000 per year

Ans. (A)

¿ cost
Break-even point (in units) =
Sales−Variable cost

¿ cost( FC)
Break-even point (in amount) = ×Sales
Sales−Variable cost ( S−V )

Given,

Sales price (per unit) =RS. 20

Total Variable cost (per unit) = Rs. 11+3 = Rs. 14

Total Fixed (per year) = Rs. 5, 40,000+2, 52,000 = Rs. 7, 92,000

7,92,000
B.E.P. (in unit) =
(20−14)
,
7,92,000
= 6 ,

= 132000 (per unit)

7,92,000
B.E.P. (in Rs.) = × 20,
(20−14)

7,92,000
= × 20,
6

= Rs. 26, 40,000.


(B)

F .C .+ Profit(Traget )
Sales (in unit) =
(S−V )

7,92,000+ 60,000
Sales (in unit) =
(20−14)
,
8,52,000
= 6 ,

= 1, 42,000 (units)

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