Variable Costs

SELLING PRICE/UNIT ($) 4,350 3,850 Answer 4.

PER UNIT Cost FOR Producing - 3000 UNITS FOR Producing - 3500 UNITS Selling 1000 units in regular market Selling 1000 units in Foreign market

COST DATA Rs. Rs. Rs. Sales 4,350,000 Variable costs 1,795,000

VARIABLE COSTS: Variable cost 2,070,000 Shiping Fixed price per unit 410

DIRECT MATERIAL 550.00 1,650,000 1,925,000 x=P+TFC/(S.P-V.C) Contribution margin 2,280,000 Fixed Markiting cost 22,000

DIRECT LABOUR 825.00 2,475,000 2,887,500 Net profit 850,000 Total fixed price 1,092,000

VARIABLE OVERHEAD 420.00 1,260,000 1,470,000 Total Sale 3,737,000

VARIABLE MARKETING 275.00 825,000 962,500 Selling price per unit 3,737 Remove Variable & Fixed market price as the selling is happening outside domestic.

Total Variable costs 2,070.00 6,210,000 7,245,000

FIXED COSTS: Answer 5.

Fixed OVERHEAD 660.00 1,980,000 1,980,000 Unit to be sold 200

Fixed Marketing cost 770.00 2,310,000 2,310,000 Price at which to be sold at variable cost per unit 2,070 Assuming only Variable cost is incurred.

Total Fixed costs 1,430.00 4,290,000 4,290,000

Total unit manufacturing cost (5+6+7+11) 2,455.00 7,365,000 8,592,500 Answer 6.

Total Costs (Variable + Fixed) 3,500.00 10,500,000 11,535,000 Ans 2 -Total Cost has increased due to increase in Variable cost. PER UNIT Cost Total Cost for producing 2000 units

COST DATA Rs.

Contribution Margin /unit 2,280 1,780 DIRECT MATERIAL 550.00

Total Contribution Margin 6,840,000 6,230,000 DIRECT LABOUR 825.00

Break even volume (units) 1,882 VARIABLE OVERHEAD 420.00

Break even Sales ($) 8,184,868 VARIABLE MARKETING 220.00 Cost cut by 20%

Total Sales 13,050,000 13,475,000 Ans 2 - Sales has increased Total Variable costs 2,015.00

Net Profit 2,550,000 1,940,000 Ans 2 - Profits has declined by 6% due to high variable costs. FIXED COSTS:

%Margin 20 14 Fixed OVERHEAD 462.00 1,386,000