question archive From the following ?gures calculate BEP- Selling price per tonne Rs
From the following ?gures calculate BEP- Selling price per tonne Rs
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From the following ?gures calculate BEP- Selling price per tonne Rs. 69.50; Variable cost per tonne Rs. 3550 Fixed expenses Rs. 18.02 Lakh If this volume represents 40% capacity, what is the additional pro?t for an added production of 40% capacity, the selling price of which is 10% lower for 20% capacity production and 15% lower than the existing price for other 20% capacity.
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Step-by-step explanation
| Existing Break Even Sales |
Fixed Cost/Contribution per unit =Rs.18.02 lakhs/Rs.69.50 - Rs.35.50 =53, 000 ?units |
| Sales Value |
53000 units*Rs.69.50 = Rs.36, 83, 500 |
| It is given in the problem that 40% capacity represents 53,000 units Hence 80% capacity will represent(53000*2 = 106000 units |
|
| For additional 20% capacity, selling price falls by 10% | |
| Revised Selling Price | Rs.69.50 -Rs.6.95 = Rs.62.55 |
| Less: Variable Cost | Rs.35.50 |
| Contribution | Rs.27.05 |
| 20% capacity = | 53,000 units/2 = 26, 500 units |
| Profit if sale price is Rs.62.55 |
Contribution per unit*Sales units = Rs.7,16,825 |
| Revised Selling Price = | Rs.69.50 - Rs.10.425 = Rs.59.075 |
| Less: Variable Cost = | (Rs.35.50) |
| Contribution | Rs.23.575 |
| Profit if sale price is Rs.59.075 | Contribution per unit*Sales units |
|
Rs.23.575 *26, 500 units = Rs.6,24,737 |
|
| Additional profit by 40% sales |
Rs.7,16,825 + Rs.6,24,737 = Rs.13,41,562 |
