financial statement of company
sales(1,00,000 units @ Rs.10/-) 10,00,000
Variable costs 5,00,000
Contribution 5,00,000
Fixed costs 3,00,000
Net profit 2,00,000
p/v ratio 50%
BEP 6,00,000
Margin of safety ratio 4,00,000
If the price increases by 10% what shall be the new p/v
ratio and BEP? If the price increases by 10% is accompanied
by a reduction in volume by 12%,what shall be the effect on
BEPand profit?
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Answer / ram
financial statement of company sales(1,00,000 units @ Rs.10/-) 10,00,000 Variable costs 5,00,000 Contribution 5,00,000 Fixed costs 3,00,000 Net profit 2,00,000 p/v ratio 50% BEP 6,00,000 Margin of safety ratio 4,00,000 If the price increases by 10% what shall be the new p/v ratio and BEP? If the price increases by 10% is accompanied by a reduction in volume by 12%,what shall be the effect on BEPand profit?
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