A company produces only one product. Normal capacity is 20000 units per year and the unit sales price is Rs.5 relevant costs are:
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Unit Variable Cost
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Total Fixed Cost
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|
Materials
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Rs.1.50
|
|
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Director labour
|
1.20
|
|
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Factory Overhead
|
0.45
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Rs.15000
|
|
Marketing expenses
|
0.35
|
5000
|
|
Administrative expenses
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|
6000
|
Required:
Compute (2) break even point in units of product (2) break even point in sales (3) the number of units product that must be produced and sold to achieve a profit of Rs.10000 and (4) the sales revenue required to achieve a profit of Rs.10000.