Q2: 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. Note: No need to enter currency symbol and comma just type numbers and nearest roundoff (for example: 10000 or 10000.65=10001) A: Compute the sale price per bottle which will enable management to realize a profit of 10 percent of sales. B: Calculate the break-even point in rupees if sale price is fixed at Rs. 11 per bottle.
Q2: 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.
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Note: No need to enter currency symbol and comma just type numbers and nearest roundoff (for example: 10000 or 10000.65=10001) |
A: Compute the sale price per bottle which will enable management to realize a profit of 10 percent of sales.
B: Calculate the break-even point in rupees if sale price is fixed at Rs. 11 per bottle.
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