Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
Margin of Safety
V.Sales to get a profit of Rs.90, 000 VI.Profit when sales is Rs.265000.
2. You are given the following information about two companies in 2000
3. The following figures have been extracted from the financial statement of Goldman Sachs
during the period 2007-08.
Sales(2,00,000 units @ Rs.10 each) Rs.20,00,000
Variable Cost Rs.10,00,000
Contribution Rs.10,00,000
Fixed Cost Rs.6,00,000
Net Profit Rs.4,00,000
You are required to find out,
i) Beak even sales ii.Margin of safety ratio iii.What is new BEP if p/v ratio increases
by 10%. iv.Profit when sales is 30,00,000 v.Sales when profit is 3,00,000.
4.Gamma Company owns a machine that produces a component for the products the
company makes and sells. The company uses 1,800 units of this component in production
each year. The costs of making one unit of this component are
Direct material 7
Variable manufacturing overhead 6
Direct labor 4
Fixed manufacturing overhead 3
An outside supplier has offered to sell Gamma this component for Rs.18 per unit and can
supply all the units it needs.Should Gamma buy this product or make it.
5.A company manufactures a product and sells it at Rs.40 per unit.The fixed cost per year for
the company is Rs.120000.The company incurs following expenses to produce one product
Material per unit-Rs.6
Labor per unit-Rs.4
Other indirect expenses-Rs.10
Find the BEP in units as well as in Rupees. Find the MoS if the company sales 27000 units. If
the current p/v ratio decreases by 20%,then find the new break even point in rupees.