Doubt in Marginal Costing

MOS(Rs) - 187500

MOS (units) 7500

Total Cost - 193750 

BES (units) 2500

Find

1) Pft 

2) P/V Ratio 

3) BES

BES units =2500 

MOS Units =7500

Therefore Total Sales units = BES+MES=10000units. 

MOS(Rs)/MOS(Units) = Saleprice per unit = 187500/7500=Rs.25 per unit

Therefore Total Sales = 10000units*Rs 25 = Rs.250000

1. Profit = Total Sales - Total Cost 

            250000 - 193750(given) = Rs.56250 Profit.

3. BES sales = BES Units 2500* Rs.25= Rs. 62500

2. P/V Ratio * MOS sales = Profit

         x        * 187500 = 56250

Thus P/V Ratio(X) = Profit/MOS sales = 56250/187500 = 0.3 = 30%

THE ANSWER AS FOLLOWS...

A.) PVR 30%

B) PROFIT 56250

C) FC 18750

D) BE SALES 62500

Sales ( units) = BES (units)+ Mos (units)

                        = 2500+7500  = 10000 units

Let contribution per unit be 'x' and selling price be 'y'.

We know that MOS (Unit) X Selling price = MOS (Rs)

             7500y = 187500 ; y = 25

BES = Fixed cost / Contribution per unit

2500 = Fixed cost / x

Fixed cost = 2500x

Variable cost per unit  = Seliingprice - Contribution per unit

                                        = 25 - x

Total Cost = Fixed Cost + Variable cost

      193750 = 2500x + 10000 (25 - x)

Solving this, x = 7.5 per unit.

Now Fixed cost = 2500 * 7.5 = 18750

  BES = 2500 * 25 = 62500

Profit = (10000*25) - 193750 = 56250

P. V Ratio = Contribution per unit / Selling price per unit = 7.5 / 30 = 30%

Contribution per unit=Sales Price per unit-Variable Cost per unit

Therefore, Cont.p.u.=500-300=200 per unit