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    Assignment Gurlal Singh

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    Gurlal Singh
    The document provides cost analysis information for three companies. It lists fixed costs, variable costs, total costs, and costs per unit for different output levels. It also provides semi-variable cost tables showing how costs change with capacity utilization for three companies.

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    Assignment Gurlal Singh

    Uploaded by

    Gurlal Singh
    57 views2 pages
    The document provides cost analysis information for three companies. It lists fixed costs, variable costs, total costs, and costs per unit for different output levels. It also provides semi-variable cost tables showing how costs change with capacity utilization for three companies.

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    Assignment gurlal singh

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    The document provides cost analysis information for three companies. It lists fixed costs, variable costs, total costs, and costs per unit for different output levels. It also provides semi-variable cost tables showing how costs change with capacity utilization for three companies.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    57 views2 pages

    Assignment Gurlal Singh

    Uploaded by

    Gurlal Singh
    The document provides cost analysis information for three companies. It lists fixed costs, variable costs, total costs, and costs per unit for different output levels. It also provides semi-variable cost tables showing how costs change with capacity utilization for three companies.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 2

    Que1: Firm Fisher's incorporation engages in the production of Canned-food products.

    In 2019
    firm produced 2000 units of Canned products. In 2020, firm is planning to increase its output. It
    wants you to figure out what would be the total cost if it decides to increase it's output. Firm's
    productive capacity is 15000 units. fixed cost incurred by firm is 90,000 $ and variable cost per unit
    is 20$ per unit. for the below mentioned output level:

    Output Fixed Fixed Variable Variable Total cost Total cost Incremental
    cost cost per cost cost per per unit cost
    unit unit
    1000 90000 90 20000 20 110000 110
    3000 90000 30 60000 20 150000 50 40000
    5000 90000 18 100000 20 190000 38 80000
    7000 90000 12.86 140000 20 230000 32.86 120000
    8000 90000 11.25 160000 20 250000 31.25 140000
    15000 90000 6 300000 20 390000 26 280000
    20000 20

    find out the:

    a) fixed cost

    b) fixed cost per unit

    c) variable cost

    d) variable cost per unit

    e) total cost

    f) total cost per unit

    provide your analysis for the question:

    FC – remains same

    Fcpu- decreases as sales go up

    Vc- increases as sales go up

    Vcpu- stays same

    Tc- increases with rise in sales (due to increasing vc and constant fc)

    Tcpu- decreases with increase in sales

    Que2. XYZ ltd is a manufacturing concern, currently using a machinery which has a semi variable
    cost of 450,000$. Currently it is operating at 40% capacity, producing 4000 units. If it increases its
    production, its cost will increase by 20% up to 80% of the production level, after that it will
    increase by 25% up to 90% of the output capacity and if it realises its full capacity, its cost will
    shoot up by 30%.

    OUTPUT SVC SVCPU


    CAPACITY
    4000 450000 112.5
    40%
    5000 540000 108
    50%
    6000 540000 90
    60%
    7000 540000 77.14
    70%
    8000 540000 67.5
    80%
    9000 675000 75
    90%
    10000 877500 87.75
    100%

    Que3. Semi variable cost Rs.150000 are constant up to 70 % capacity [7,000 units] But increase by
    10% over 70 % but up to 80% and then increase by 20% over 80% but up to 100% capacity.

    Capacity OUTPUT SEMI-VARI COST SVCPU (SVC/OU)

    50% 5000 150000 30

    60% 6000 150000 25

    70% 7000 150000 21.43

    80% 8000 165000 20.62

    90% 9000 198000 22

    100% 10000 198000 19.8

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