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    madhura
    1) The break even point is calculated as fixed costs divided by the contribution per unit or profit volume ratio. The margin of safety is actual sales minus break even sales. 2) For Case 1, with a profit volume ratio of 24%, the break even point is 25,000 units of sales. When variable costs increase 10%, the profit volume ratio decreases to 16% and break even sales increase. 3) For Case 2, the profit volume ratio is calculated as the increase in profit divided by the increase in sales between two periods.

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    1) The break even point is calculated as fixed costs divided by the contribution per unit or profit volume ratio. The margin of safety is actual sales minus break even sales. 2) For Case 1, with a profit volume ratio of 24%, the break even point is 25,000 units of sales. When variable costs increase 10%, the profit volume ratio decreases to 16% and break even sales increase. 3) For Case 2, the profit volume ratio is calculated as the increase in profit divided by the increase in sales between two periods.

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    1) The break even point is calculated as fixed costs divided by the contribution per unit or profit volume ratio. The margin of safety is actual sales minus break even sales. 2) For Case 1, with a profit volume ratio of 24%, the break even point is 25,000 units of sales. When variable costs increase 10%, the profit volume ratio decreases to 16% and break even sales increase. 3) For Case 2, the profit volume ratio is calculated as the increase in profit divided by the increase in sales between two periods.

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    Exel

    Uploaded by

    madhura
    1) The break even point is calculated as fixed costs divided by the contribution per unit or profit volume ratio. The margin of safety is actual sales minus break even sales. 2) For Case 1, with a profit volume ratio of 24%, the break even point is 25,000 units of sales. When variable costs increase 10%, the profit volume ratio decreases to 16% and break even sales increase. 3) For Case 2, the profit volume ratio is calculated as the increase in profit divided by the increase in sales between two periods.

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    of 5

    bep= breK EVEN POINTS

    change in profit /profitx 100


    break even point =fixed cosst /contibution per unit
    mos=margin of safty=actual sales-break even sales
    mos=sales-fixed cost/pv ratio
    mos=salesx pv ratio- fixed cost
    mos=contribution-fixed cost/ pv ratio
    mos=profit/pv ratio

    case 1
    variable cost=
    20500+75000+100000
    contibution sales-vc
    500000-380000
    120000
    pv ratio 24%
    BEP sales= 60000/24%
    BEP sales= 60000/24% 25000

    revised bep when 10% increase in VC


    direct material 205000
    direct lavour 75000
    variable expenses 10000
    380000
    add 10% 38000
    418000
    contribution =500000-418000
    contribution 82000
    pv ratio 16%
    BEP SALES = FC/PV RATIO

    TOTAL
    CASE 2 SALES COST PROFIT
    PERIOD 1 39000 34800 4200
    PERIOD 2 43000 4300 5400

    PROFIT VOLUME RATIO=INCREASE IN PROFIT/INCREASE IN SLAES


    (5400-4200)/(43000-39000)
    1200 4000
    30%

    CONTRIBUTION = sleas*PV ratio


    period1 27300
    period 2 30100

    fixed cost=contribution -profit


    period 1 7500
    period 2 7500

    CASE 3
    PV RATIO=CNAGE IN PROFIT/CHANGE IN SALE
    40000-20000/30000-20000 *1000
    20%

    CASE 4
    SALES 5000000
    PV RATIO 50%
    MARGIN OF SAFTY 40%

    TO FIND:BOP, PROFIT
    PROFIT=MOS/PVRATIO 80%

    BREAK EVEN SALES= ACTUAL-MOS


    MARGIN OF SAFTY AMOUNT 2000000

    PROFIT=MOS*PV RATIO 1000000


    BOP 3000000
    MATERAIL RS 50
    LABOUR rs. 80
    VARIABLE OVERHEAD 75%
    FIXED OVERHEAD 240000
    SALE PRICE 230/per unit
    revised BEPwhen 10% increase in FC
    current FC 60000
    add 10% increase 6000
    new FC 66000

    prevised bep
    BEP sales 275000
    summary

    period 1 period 2
    contribution 11700 12900
    variable cost 27300 30100
    fc 7500 7500

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