Calculate the number of units by selling

Reference no: EM133127182

Question 1: The following details are obtained from the records of a factory:

Sales 4,000 units at Ks. 25 each             1,00,000
Material consumed                                 40,000
Variable overheads 10,000
Labour charges    20,000
Fixed overheads                                    18,000
                                                         88,000
Net profit                                                                 12,000

Calculate:

(i) The number of units by selling which the company will neither lose nor gain anything.

(ii) Sales needed to earn a profit of 20% on sales.

(iii) The extra units to be sold to obtain present profit if it is proposed to redact selling price by (a) 20% and (b) 25%.

(iv) The selling price to be fixed to bring down its REP to 500 units under presenl conditions.

Reference no: EM133127182

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