Quiz: ADM Quiz-2

(1
) A company with contribution/sales ratio of 33.5% and fixed cost of Rs.3 lakhs per month should have a monthly sales of
Rs.___ lakhs to maintain a margin of safety of 10%.

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1 6
2 8
3 10
4 12

(2 A company maintains a margin of safety of 25% on its current sales and earns a profit of Rs. 30 lakhs per annum. If the
) company has a profit volume(P/V) ratio of 40%, its current sales amount to :

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1 Rs. 200 lakhs
2 Rs.300 lakhs
3 Rs.325 lakhs
4 Rs. 350 lakhs

In two consultative periods, sales and profit were Rs 1,60,000 and Rs. 8,000 respectively in the first period and Rs.
(3) 1,80,000 and Rs. 14,000 respectively during the second period. If there is no change in fixed cost between the two periods
then P.V. ratio must be _ .

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1 20%
2 25%
3 30%
4 40%

(4 Horizon Ltd. manufacturers' product BM for last 5 years. The company maintains a margin of safety of 37.5% with over all
) contribution to sales ratio of 40%. If the fixed cost is Rs 5 lakh, the profit of the company is :

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1 Rs. 24 lakhs
2 Rs. 12.5 lakhs
3 Rs. 3 lakhs
4 Rs. 8 lakhs

(5 A company has budgeted breakeven sales revenue of Rs 8,00,000 and fixed costs of Rs.3,20,000 for the next period. The
) sales revenue needed to achieve a profit of Rs. 50,000 in the period will be :

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1 Rs. 8,50,000
2 Rs. 9,25,000
3 Rs. 11,20,000
4 Rs. 12,00,000

(6 A company has margin of safety of Rs.40 lakhs and earns an annual profit of Rs. 10 lakhs. If the fixed costs amount to Rs.
) 20 lakhs, annual sales will be _.

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1 Rs. 160 lakhs
2 Rs. 140 lakhs
3 Rs. 120 lakhs
 4 Rs. 200 lakhs

A company has annual turnover of Rs. 200 lakhs and an average C/S ratio of 40%. It makes 10% profit on sales before
(7
charging depreciation and interest which amount to Rs. 10 lakhs and Rs 15 lakhs respectively. The annual fixed cost of the
)
company is __ .

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1 Rs.85 lakhs
2 Rs.75 lakhs
3 Rs.60 lakhs
4 Rs.55 lakhs

(8) Sales for two consecutive months, of a company are Rs. 3,80,000 and Rs. 4,20,000. The company's net profits for these
months amounted to Rs. 24,000 and Rs.40,000 respectively. There is no change in C/S ratio or fixed costs. The C/S ratio of
the company _ .

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1 1/3
2 2/5
3 1/4
4 2/3

(9
If sales are Rs. 2 lakhs, fixed cost is Rs. 30,000 and P.V. ratio is 40%, the amount of profit will be :
)

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1 Rs. 50,000
2 Rs. 80,000
3 Rs. 12,000
4 Rs. 40,000

(10
If Profit-Volume (p/V) ratio is 40 % and sales value is Rs 10,000, the variable cost will be :
)

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1 Rs. 4,000
2 Rs. 6,000
3 Rs. 5,000
4 Rs. 7,000

A product sells for Rs.8 each with variable cost of Rs.5 each. Fixed costs are budgeted at Rs. 18,000 or Rs. 2 per unit. The
(11)
margin of safety is :

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1 50%
2 33.33%
3 62.5%
4 55%

(12
if fixed cost is Rs 10,000 and profit value (P/V) ratio is 50%, the break even will be :
)

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1 Rs. 20,000
2 Rs. 50,000
3 Rs. 10,000
4 Rs. 40,000

(13
) If P/V ratio is 40% and sales value is Rs. 10,000, the variable cost is :
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1 Rs. 40,000
2 Rs. 4,000
3 Rs. 24,000
4 Rs. 6,000

(14
If sales are Rs. 2,00,000, fixed cost Rs.30,000 and P.V. ratio is 40%, the profit will be :
)

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1 Rs.50,000
2 Rs. 80,000
3 Rs.12,000
4 Rs.40,000

(15 X Ltd. has earned contribution of Rs 2,00,000 and net profit of Rs 1,50,000 and sales of Rs. 8,00,000. What is the margin
) of safety?

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1 Rs. 5,75,000
2 Rs.4,00,000
3 Rs. 7,00,000
4 Rs.6,00,000

(16 X Ltd. has sals of Rs.2,200, total fixed cost of Rs 570, variable cost of Rs.1,540, raw material consumed of Rs.1,100,
) number of units sold 22,000. What shall be the BEP (in units) if raw material price is reduced by 2%.

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1 18,387
2 18,560
3 18,750
4 19,000

(17 A company determines its selling price by marking up variable costs 60%. In addition the company uses frequent selling
) price mark downs to stimulate sales. If the mark downs average 10%, what is the company's contribution margin ratio?

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1 27.5%
2 30.6%
3 37.5%
4 41.75%

(18 B Ltd. has earned net profit of Rs.1 lakh, and its overall P.V. ratio and margin of safety are 25% and 50% respectively.
) What is the total fixed cost of the company ?

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1 Rs. 1,00,000
2 Rs. 50,000
3 Rs.2,00,000
4 Rs.1,50,000

(19
)

A company is to market new product. It can produce up to 1, 50,000 units of this product. The following are the estimated
 cost data:

Particulars Fixed cost Variable cost

____________________________________________________________

For production up to 75,000 units Rs. 8,00,000 60%

Exceeding 75,000 units Rs. 12,00,000 50%

_____________________________________________________________

Sale price expected to be Rs 25 per unit. How many units must the company sell to break-even ?

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1 1,20,000
2 1,11,000
3 96,000
4 80,000

(20)A concern sells 3 products. The budgeted fixed cost for the period is Rs. 6,00,000. The budgeted contribution to sales
(C/S ratio) and the sales mix are as under :

__________________________________________________________________

Product C/S ratio Mix

___________________________________________________________________

Super 25% 20%

Premium 40% 40%

Best 30% 40%

______________________________________________________________

What is the break-even sales revenue?

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1 Rs. 20,10,181
2 Rs. 15,23,312
3 Rs. 18,18,181
4 Rs, 17,60,600