The document analyzes the impact on profitability from changes in price and sales volume. It shows that profitability increases when price increases if volume remains the same or decreases slightly, but decreases if volume drops significantly. Conversely, profitability decreases with a price decrease if volume is constant or increases slightly, but can increase if volume rises substantially and variable costs are low.

1. Presented By:
Archit Garg
Geet Sawhney
Mohit Sharma
Siddharth Kumar

2. Price 10 10 10
Unit 10 10 10
Sales 100 100 100
V.C 25 50 75
Contribution
(S-VC) 75 50 25
F.C 70 45 20
Profit (C-FC) 5 5 5
Profitability
(Profit/Cost) % 5.26 5.26 5.26

3.  When Price is increased by 10%
a) Volume of sales remain same.
b) Volume come down by 10%
c) Volume come down by 30%

4. Price 11 11 11
Unit 10 10 10
Sales 110 110 110
V.C 25 50 75
Contribution 85 60 35
F.C 70 45 20
Profit 15 15 15
Profit Growth 200% 200% 200%
Profitability (By
Cost) % 15.79 15.79 15.79

5. Price 11 11 11
Unit 9 9 9
Sales 99 99 99
V.C 22.5 45 67.5
Contribution 76.5 54 31.5
F.C 70 45 20
Profit 6.5 9 11.5
Profit growth 30% 40% 130%
Profitability % 7.02 10 13.14

6. Price 11 11 11
Unit 7 7 7
Sales 77 77 77
V.C 17.5 35 52.5
Contribution 59.5 42 24.5
F.C 70 45 20
Loss (10.5) (3) 4.5
Profit growth -310% -160% -10%
Profitability % (12) (3.75) 6.20

7.  When Price is decreased by 10%.
a) Volume of sales remain same.
b) Volume goes up by 10%
c) Volume goes up by 30%

8. Price 9 9 9
Unit 10 10 10
Sales 90 90 90
V.C 25 50 75
Contribution 65 40 15
F.C 70 45 20
Profit (5) (5) (5)
Profit growth (200%) (200%) (200%)
Profitability % (5.26) (5.26) (5.26)

9. Price 9 9 9
Unit 11 11 11
Sales 99 99 99
V.C 27.5 55 82.5
Contributio
n 71.5 44 16.5
F.C 70 45 20
Profit 1.5 -1 -3.5
Profit
growth -70% -120% -170%
Profitability % 1.54 -1 -3.41

10. Price 9 9 9
Unit 13 13 13
Sales 117 117 117
V.C 32.5 65 97.5
Contribution 84.5 52 19.5
F.C 70 45 20
Profit 14.5 7 (0.5)
Profit growth 190% 40% (110%)
Profitability
% 14.15 6.36 (0.43)

11.  When the credit period decreases the advantages
would be:
 The additional 24% adds to our working capital.
◦ 2% per month – So the profit will increase by 4% (2
months)
 The liquidity in the company increases.
 It will result into the proper cash flow. (Inflow
and outflow)

12. 1. If price is increased:
 Profitability goes up when volume is constant or
volume decreases by a smaller portion.
 Profitability decreases when volume goes down
extensively due to the increase in price.
2. If Price is decreased:
 Profitability comes down in both the cases, i.e.
when the volume is constant as well as when the
volume goes up by a smaller portion.
 Profitability increases when the volume increases
by a higher margin and variable cost is low.