Please solve this question X limited has provided the following information Selling Price Rs. 20 per unit Variable Manufacturing Cost Rs. 11 per unit Variable Selling cost Rs. 3 per unit Fixed Factory Overheads Rs. 5, 40, 000 per year Fixed Selling Cost is Rs. 252, 000 per year You are required to calculate the followings : (1) Break Even point (ii) PV ratio (iii) Number of units that must be sold to earn a profit of Rs. 60,000 per year (iv) Impact of decrease in selling price by 10 percent on Breakeven Point. (v) Impact of increase in selling price by 20% on Break Even point.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Please solve this question
X limited has provided the following information
Selling Price Rs. 20 per unit
Variable
Fixed Factory
Fixed Selling Cost is Rs. 252, 000 per year
You are required to calculate the followings : (1) Break Even point
(ii) PV ratio
(iii) Number of units that must be sold to earn a profit of Rs. 60,000 per year
(iv) Impact of decrease in selling price by 10 percent on Breakeven Point.
(v) Impact of increase in selling price by 20% on Break Even point.
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