1. Break-Even Analysis: Practice
Problems
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# Question 1. From the following particulars, calculate:
(i) Break-even point in terms of sales value and in units.
(ii) Number of units that must be sold to earn a profit of Rs. 90,000.
Question 2. From the following data, you are required to
calculate:
(a) P/V ratio
(b) Break-even sales with the help of P/V ratio.
(c) Sales required to earn a profit of Rs. 4,50,000
Fixed Expenses = Rs. 90,000
Variable Cost per unit:
Direct Material = Rs. 5
2. Direct Labour = Rs. 2
Direct Overheads = 100% of Direct Labour
Selling Price per unit = Rs. 12.
Question 3. From the following data, you are required to
calculate break-even point and net sales value at this
point:
If sales are 10% and 25% above the break even volume,
determine the net profits.
Question 4. From the following particulars, find out the
break-even-point:
What should be the selling price per unit, if the break-even point
should be brought down to 6,000 units?
3. Question 5 The fixed costs amount to Rs. 50,000 and the
percentage of variable costs to sales is given to be 66 ⅔%.
If 100% capacity sales are Rs. 3,00,000, find out the
break-even point and the percentage sales when it
occurred. Determine profit at 80% capacity.
Question 6 From the following information, ascertain by
how much the value of sales must be increased by the
company to break-even:
Question 7. Calculate:
(i) The amount of fixed expenses.
(ii) The number of units to break-even.
(iii) The number of units to earn a profit of Rs. 40,000.
The selling price per unit can be assumed at Rs. 100.
The company sold in two successive periods 7,000 units and 9,000
units and has incurred a loss of Rs. 10,000 and earned Rs. 10,000
as profit respectively.
Question 8. A company is making a loss of Rs. 40,000 and
relevant information is as follows:
Sales Rs. 1,20,000; Variable Costs Rs. 60,000; Fixed costs Rs.
1,00,000.
4. Loss can be made good either by increasing the sales price or by
increasing sales volume. What are Break even sales if
(a) Present sales level is maintained and the selling price is
increased.
(b) If present selling price is maintained and the sales volume is
increased. What would be sales if a profit of Rs. 1,00,000 is
required ?
