Question:-
Last year, a manufacturer produced 15000 products while were Sold Rs. 300 each. At that volume, the fixed costs were Rs. 15.2 lacs and total variable costs were Rs.21 lacs. The break even quantity of product would be
Option (A)
4000
Option (B)
7800
Option(C)
8400
Option(D)
9500
Correct Option:
(D)
Question Solution:
Total variable cast = Rs. 21,00000
\ Cv = (2100000/15000) = Rs. 140
CF + Cvx = Cpx
x = (CF / (Cp-Cv))
= {(15.2 x 105) / (300-140)} = 9500
\ Break Even quantity = 9500
question-answer-faq-8753