b) PST Limited is a cement block production company. It has developed a new cement block having higher strength, better appearance, and less self-weight. PST Limited requires a return on invested capital of 25% per annum. Budgeted sales volume (in units) -100,000 units. Variable production cost per unit - Rs. 65 Fixed production cost per unit - Rs. 55 Other annual fixed costs (overheads etc.) - Rs. 2,500,000 Investment in machinery to produce the new block - Rs. 1,200,000 Period over which investment in new machinery is to be written off - 05 years. Research and development costs for the new block - Rs. 800,000 i) Calculate the unit price of the new cement block based on the above data. (05 marks)
b) PST Limited is a cement block production company. It has developed a new cement block having higher strength, better appearance, and less self-weight. PST Limited requires a return on invested capital of 25% per annum. Budgeted sales volume (in units) -100,000 units. Variable production cost per unit - Rs. 65 Fixed production cost per unit - Rs. 55 Other annual fixed costs (overheads etc.) - Rs. 2,500,000 Investment in machinery to produce the new block - Rs. 1,200,000 Period over which investment in new machinery is to be written off - 05 years. Research and development costs for the new block - Rs. 800,000 i) Calculate the unit price of the new cement block based on the above data. (05 marks)
Chapter12: Balanced Scorecard And Other Performance Measures
Section: Chapter Questions
Problem 4PB: Banyan Industries has two divisions, a tax rate of 30%, and a minimum rate of return of 20%....
Related questions
Question
![b) PST Limited is a cement block production company. It has developed a new cement block having higher strength, better appearance, and less self-weight. PST Limited requires a return on invested capital of 25% per annum.
Budgeted sales volume (in units) -100,000 units. Variable production cost per unit - Rs. 65 Fixed production cost per unit - Rs. 55 Other annual fixed costs (overheads etc.) - Rs. 2,500,000 Investment in machinery to produce
the new block - Rs. 1,200,000 Period over which investment in new machinery is to be written off - 05 years. Research and development costs for the new block - Rs. 800,000 i) Calculate the unit price of the new cement block
based on the above data. (05 marks)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F16d3dd7e-98c3-4994-b2fd-ea5448f2d6c2%2Fa2d03777-9789-43ce-8653-c82852754c08%2Fvgwgmt_processed.png&w=3840&q=75)
Transcribed Image Text:b) PST Limited is a cement block production company. It has developed a new cement block having higher strength, better appearance, and less self-weight. PST Limited requires a return on invested capital of 25% per annum.
Budgeted sales volume (in units) -100,000 units. Variable production cost per unit - Rs. 65 Fixed production cost per unit - Rs. 55 Other annual fixed costs (overheads etc.) - Rs. 2,500,000 Investment in machinery to produce
the new block - Rs. 1,200,000 Period over which investment in new machinery is to be written off - 05 years. Research and development costs for the new block - Rs. 800,000 i) Calculate the unit price of the new cement block
based on the above data. (05 marks)
AI-Generated Solution
Unlock instant AI solutions
Tap the button
to generate a solution
Recommended textbooks for you
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College