COST ACCOUNTING
BREAK EVEN POINT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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For a modeling agency, Fixed costs:= £30, 000; Variable cost:= £200 per photo shoot; Forecast output (Sales):= 140 photo shoots; Selling price:= £1000 per photo shootWhat is the Contribution Margin?
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£112 000
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£112 500
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£375
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£800
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Explanation:
Detailed explanation-1: -Fixed cost = Total cost of production-(Variable cost per unit x number of units produced)
Detailed explanation-2: -Variable costs change based on the amount of output produced. Variable costs may include labor, commissions, and raw materials. Fixed costs remain the same regardless of production output. Fixed costs may include lease and rental payments, insurance, and interest payments.
Detailed explanation-3: -Calculation of M.O.S-M.O.S.= Actual Sales – B.E.P. Sales = 100000-60000= ₹40, 0000 OR M.O.S. = Profit = 20000 X 100 = ₹40, 000 P/V 50 Calculation of profit on the basis of M.O.S. – M.O.S.
Detailed explanation-4: -Answer: The answer is 5, 000 units.
There is 1 question to complete.