Save Rs 588 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

PLZ SOVLE THIS MARGIANL COSTING PROBLEM

Save Share

This query is : Resolved

CA Abhishek Singh (Querist)
Follow

02 April 2010 A COMPANY HAS A FIXED COST OF RS.300000.

ON SALE OF 15000 UNITS WHICH IS EQUAL TO 40% OF MARGIN OF SAFETY, IT EARNED A PROFIT OF RS.60000/-.

CALCULATE THE FOLLOWING
1) BEP IN UNITS
2) TOTAL PRESENT SALES IN UNITS
(BCOM,MUMBAI OCT 2007.)

THANX IN ADVANCE
MY ID abhipcc@rediffmail.com

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
Follow

02 April 2010 In the problem 40 % of margin of saftey represents 15000 units and Rs.60000/- profit.in the margin of saftey sales, the contribution doesnot include fixed cost so total contribution is profit only.contribution per unit is

60000/15000 = Rs.4 Per unit

and the BEP in unit is F.C / contribution per unit
so 300000/4 = 75000 units

For 15000 units is 40 % of MOS so total margin of saftey is 15000/.4=37500 units

so total persent sales is (75000+37500)=112500 units

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now