COGS = fixed mfg cost + variable mfg cost Mkt & dist cost = fixed + variable

variable mfg cost = COGS - fixed mfg cost 11,50,000 = fixed + (200000*4)
variable mfg cost = 1600000 - 500000 1100000 fixed = 11,50,000 - 800000
variable mfg cost per unit = 1100000/200000 5.5 350000

Contribution Income Statement (200000 units)

Sales 2,600,000
less variable cost
variable mfg cost 1100000
variable mkt & dist cost =200000*4 800000 1900000
Contribution 700,000
less fixed cost
fixed mfg cost 500000
fixed mkt & dist cost 350000 850000
Profit -150,000
Mkt & dist cost = fixed + variable SP = 2600000/200000
11,50,000 = fixed + (200000*4) 13
fixed = 11,50,000 - 800000

Financial Accounting Income Statement (230000 units) CPU 13 - 5.5 -4 3.5

Sales (230000*13) 2,990,000
less variable cost BEP units 850000/3.5 242857.1
variable mfg cost 1265000 BEP 3157142.86
variable mkt & dist cost =230000*4 920000 2185000
Contribution 805,000
less fixed cost
fixed mfg cost 500000
fixed mkt & dist cost 350000 850000
Profit -45,000
BEP Fixed cost / PV Ratio
500000/40%
1250000

Total sales BEP + margin of safety

100 BEP + 37.5
BEP 100 - 37.5
62.5
62.5 1250000
100 ?

Total sales (1250000*100)/62.5

2000000

variable cost ratio = 100 - PV ratio

60%
Variable cost 2000000*0.6
1200000

Profit = contribution - fixed cost (2000000*0.4) - 500000

300000

MOS total sales - BEP total sales = 2000000*107.5%

2150000 - 1250000 2150000
900000
PV Ratio = change in profit / change in sales Contribution - fixed cost = profit
(50000-40000)/(340000-300000) Fixed cost = Contribution - profit
0.25 25% (300000*25%) - 40000
35000
BEP Fixed cost / PV Ratio
35000/25%
140000

Desired sales = fixed cost + profit / PV ratio

(35000+80000)/25%
460000

Profit = contribution - fixed cost

(500000*25%)-35000
90000

Margin of safety = actual - BEP Desired sales = fixed cost + profit / PV ratio
540000-140000 (35000+100000)/25%
400000 540000

Variable cost = sales * variable cost ratio Variable cost ratio = 100 - PVR
100-25
2021 300000*75% 225000 75%
2022 340000*75% 255000
fit / PV ratio
PV Ratio = change in profit / change in sales
(32400-10800)/(513000-405000)
0.2 20%

Contribution - fixed cost = profit

Fixed cost = Contribution - profit
(405000*20%) - 10800
70200

Profit/loss = contribution - fixed cost

(324000*20%)-70200
-5400

Desired sales = (fixed cost + profit) / PV ratio

(70200+54000)/20%
621000
 A B
Direct material 10 9
Direct wages 3 2
Variable expenses 3 2 100% of direct wages
Total variable cost per unit 16 13
SP 20 15
Contribution per unit 4 2

Sales mix 1 2 3
Units of A 100 150 200
Units of B 200 150 100
total contribution 800 900 1000
less fixed cost 800 800 800
profit 0 100 200
 PRODUCT A PRODUCT B
Sales 100 120
Material cost 10 15
Direct wages cost 15 10
Direct expenses 5 6
Variable o/h 15 20
total variable cost 45 51
contribution per unit 55 69

PV ratio C/S*100 55 57.5

contribution per kg of RM 55/2 69/3

27.5 23

contribution per machine hour 55/3 69/2

18.333333333 34.5

Raw material available 10000

product A (3500*2) 7000
Available for B 3000
units of B 3000/3 1000

A B Total
units 3500 1000
CPU 55 69
Contribution 192500 69000
less fixed cost (5;10 at maximum capacity) 17500 35000
Profit 175000 34000 209000
1) Total sales potential in units is limited; B

2) Total sales potential in value is limited; A

3) Raw material is in short supply; A

4) Production capacity (in terms of machine hours) is the limiting factor. B

Existing Case 1 Case 2

Revenues 10,000,000 Revenues 10,000,000 Revenues 10,000,000

VC 8,000,000 VC 8,200,000 VC 8,000,000
CPU 2,000,000 CPU 1,800,000 CPU 2,000,000
Fixed cost 1,800,000 Fixed cost 1,800,000 Fixed cost 1,890,000
Proft 200,000 Proft 0 Proft 110,000
Case 3 Case 4

Revenues 9,200,000 Revenues 11,000,000

VC 7,360,000 VC 8,800,000
CPU 1,840,000 CPU 2,200,000
Fixed cost 1,800,000 Fixed cost 1,980,000
Proft 40,000 Proft 220,000