Question

A company has Fixed Costs of ₹2,00,000, a contribution margin ratio (P/V ratio) of 25%, and it achieved total sales of ₹10,00,000. Calculate the profit earned and Margin of Safety, is it comfortable.

A Profit = ₹2,50,000; MoS = ₹2,50,000= High
B Profit = ₹1,50,000; MoS = ₹50,000 = Low
C Profit = ₹2,00,000; MoS = ₹1,00,000 = Medium
D Profit = ₹50,000; MoS = ₹2,00,000 = Moderate
E Profit = ₹4,00,000; MoS = ₹2,50,000 = High
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