A company had incurred fixed expenses of Rs. 540000, with sales of Rs. 1800000 and earned a profit of Rs. 360000 during the first half. In the second half, it suffered a loss of Rs. 180000.
A company had incurred fixed expenses of Rs. 540000, with sales of Rs. 1800000 and earned a profit of Rs. 360000 during the first half. In the second half, it suffered a loss of Rs. 180000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
A company had incurred fixed expenses of Rs. 540000, with sales of Rs. 1800000 and
earned a profit of Rs. 360000 during the first half. In the second half, it suffered a loss of Rs.
180000.
Calculate-
a) The profit volume ratio, break even point and margin of safety for the first half year.
b) Expected sales volume for the second half year assuming that selling price and fixed
expenses remained unchanged during the second half year.
c) The break even point and margin of safety for the whole year.
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