what is the reason for finding break even point
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Answer / renu
BEP is the point where we have no profit and no loss.so to
take any risk we find the break even point
| Is This Answer Correct ? | 14 Yes | 1 No |
Answer / santu
BEP IS THE POINT WHERE NO PROFIT NO LOSS FOR A FIRM. SO TO
TAKE ANY DECESION IT SHOULD BE MEASURED.AND IT IS THE MOST
CRUCIAL STEP TO SETTING UP NEW TARGETS
| Is This Answer Correct ? | 8 Yes | 0 No |
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A firm had the following Balances on 1 January 1994: (i) Provision for bad and doubtful debts Rs 2,500 (ii) Provision for discounts on debtors Rs 1,200 (iii) Provision for discounts on creditors Rs 1,000 During the year, bad debts amounted to Rs 2,000, discounts allowed were Rs 100 and discounts received were Rs 200. During 1995 bad debts amounting to Rs l,000 were written off while discounts allowed and received were Rs 2,000 and Rs 5,000 respectively. Total debtors on 31 December, 1995 were Rs 48,000 before writing off bad debts, but after allowing discounts. On 31 December, 1995, this amount was Rs 19,000 after writing off the bad debts, but before allowing discounts. Total creditors on these two dates were Rs 20,000 and Rs 25,000 respectively. It is the firm’s policy to maintain a provision of 5% against bad and doubtful debts and 2% for discount on debtors and a provisions of 3% for discount on creditors. Show the accounts relating to provisions on debtors and provisions on creditors for the year 1994 and 1995.
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