Question

From the following information calculate the amount of sales to earn a desired profit of Rs.12,000

Fixed Cost: 24,000

Selling Price: 10 per unit

Variable cost: 6 per unit

A 50,000 Correct Answer Incorrect Answer
B 90,000 Correct Answer Incorrect Answer
C 30,000 Correct Answer Incorrect Answer
D 60,000 Correct Answer Incorrect Answer

Solution

Calculation of PV ratio = Contribution / Selling Price *100 [(10-6)/10] * 100 = 40% Sales to earn desired profit = Fixed Cost + Desired Profit / PV ratio (24000+12000) / 40%

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