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Ravi SADhiyan (Practice) (4510 Points)

28 August 2019

Transfer Pricing Page No 7.30 Of PM. How to come 1,50,000 mtr at 80% level and 2,50,000 at 100 % level

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Ravi SADhiyan (Practice) (4510 Points)
Replied 28 August 2019

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AMRITA SINGH (KOLKATA) (419 Points)
Replied 28 August 2019

500000 mtr is total production capacity of textile. out of which 30% it sells to process department which means 150000. and 50% to outside. total 400000 mtrs sold by textile department. 20% of production capacity is untilised.

at 100 % capacity utilisation 50% for outsider and 30%+20% extra for process department i.e 150000+ 100000= 250000 mtr

at 80% capacity textile department is selling only 30% of 500000
at 100% capacity textile department is selling 50% of 500000

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