A company is making a loss of Rs. 40,000 and relevant information is as follows: Sales Rs. 1, 20,000; Variable Costs Rs. 60,000; Fixed costs Rs. 1, 00,000.Loss can be made good either by increasing the sales price or by increasing sales volume. What are Break even sales if (a) Present sales level is maintained and the selling price is increased. (b) If present selling price is maintained and the sales volume is increased. What would be sales if a profit of Rs. 1, 00,000 is required?

A company is making a loss of Rs. 40,000 and relevant information is as follows: Sales Rs. 1, 20,000; Variable Costs Rs. 60,000; Fixed costs Rs. 1, 00,000.Loss can be made good either by increasing the sales price or by increasing sales volume. What are Break even sales if (a) Present sales level is maintained and the selling price is increased. (b) If present selling price is maintained and the sales volume is increased. What would be sales if a profit of Rs. 1, 00,000 is required?

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter6: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 23E

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