P/v ratio =contribution/sales * 100 =500000/1000000*100

how to calculate the p/v ratio, break even point and the
margin of safety ratio when following statements are given.
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

Question Posted / shashi kumar b.com student

4 Answers
40236 Views
CA, I also Faced
E-Mail Answers

Answer Posted / shashi kumar b.com student

P/v ratio =contribution/sales * 100
=500000/1000000*100
P/v Ratio =50%

BEP=fixed cost/contribution*sales

=300000/500000*1000000
BEP =6000000

Margin of safety = sales-BEP
=1000000-6000000
Margin of safety=5000000

Is This Answer Correct ?

0 Yes

1 No

Post New Answer View All Answers

Please Help Members By Posting Answers For Below Questions

What's Demat A/c?

1105

Explain what is bridge equity?

1043

What is marginal standing facility (msf)?

1081

Tell something about your recent college project.

1174

What is the difference between difference between fiscal and monetary policy?

1032

Explian Online Banking?

1068

Why do accounts need adjusting entries?

1096

What is national banking entrance exam (nbet) and who conducts it?

939

What Is Ppf?

1134

What is Company Limited by Guarantee?

1093

Explain the Types of Banks in India

1111

What were the headlines in the Financial Times today?

1144

Why are venture capitalists opposite to angel investors?

1069

Discuss on consumer credit card.

1144

Full form of SIDBI? Does it play any role in removing unemployment?

1238