A company produces mineral water. Based on the projected annual sales of 40,000 bottles of mineral water, cost studies have produced the following estimates: Total annual costs (in rupees) Variable cost percentage Material 193,600 100 Labour 90,000 70 Overhead 80,000 64 Administration 30,000 30 The production will be sold through dealers who would receive a commission of 8% of sale price. Management to realize a profit of 10 percent of sales. Required: Calculate Total Variable Cost
A company produces mineral water. Based on the projected annual sales of 40,000 bottles of mineral water, cost studies have produced the following estimates:
Total annual costs
(in rupees) Variable cost percentage
Material 193,600 100
Labour 90,000 70
Overhead 80,000 64
Administration 30,000 30
The production will be sold through dealers who would receive a commission of 8% of sale price.
Management to realize a profit of 10 percent of sales.
Required:
Calculate Total Variable Cost
Step by step
Solved in 2 steps
