Marginal costing

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Querist : Anonymous

Querist : Anonymous (Querist)

14 March 2014 A firm has a loss of Rs. 2.50 per unit when sales are 20000 units. When sales are 24000 units the loss is rs. 1.25 per unit.

Determine the break-even point.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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14 March 2014 should be 30000 units

let the fixed cost be y and per unit marginal contribution be x

form two equations

20000x - y = 20000*2.5

24000x - y = 24000*1.25

solve the same to get value of x as 5 and y as 150000. fit the same values in equation

Q*5-150000 = 0

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