how to calculate the p/v ratio, break even point and the margin of safety ratio

how to calculate the p/v ratio, break even point and the
margin of safety ratio when following statements are given.
sales(1,00,000 units @ Rs.10/-) 10,00,000
Variable costs 5,00,000
contribution 5,00,000
Fixed costs 3,00,000
Net Profit 2,00,000

Question Posted / bhuvaneshwari

4 Answers
38140 Views
CA, I also Faced
E-Mail Answers

Answers were Sorted based on User's Feedback

how to calculate the p/v ratio, break even point and the margin of safety ratio when following stat..

Answer / sethusangurajan

p/v ratio=contribution/sales*100
=5,00,000/10,00.000*100
=50%
BEP =fixed cost/pv ratio
=3,00,000/50%
=6,00,000
margin of safety=profit/pv ratio
=2,00,000/50%
=4,00,000

Is This Answer Correct ?

71 Yes

6 No

how to calculate the p/v ratio, break even point and the margin of safety ratio when following stat..

Answer / nawrid

p/v ratio=contribution/sales*100
=500000/1000000*100
=50%(percentage of sales)
BEP in cost=Fixed cost/pv ratio
=300000/50%
=600000
BEP in Quantity=Fixed cost/Contribution per unit
=300000/5
=60000
Margin in Safety =Actual sales-BEP sales
=1000000-600000
=400000

Is This Answer Correct ?

28 Yes

5 No

how to calculate the p/v ratio, break even point and the margin of safety ratio when following stat..

Answer / vedika juyal

*p/v ratio=contribution margin/sales*100

Is This Answer Correct ?

12 Yes

1 No

how to calculate the p/v ratio, break even point and the margin of safety ratio when following stat..

Answer / shashi kumar b.com student

P/v ratio =contribution/sales * 100
=500000/1000000*100
P/v Ratio =50%

BEP=fixed cost/contribution*sales

=300000/500000*1000000
BEP =6000000

Margin of safety = sales-BEP
=1000000-6000000
Margin of safety=5000000

Is This Answer Correct ?

0 Yes

1 No

Post New Answer

More Banking Finance Interview Questions

What Entry Will Be Passed, When Debentures Are Issued at Par?

0 Answers Joint Stock Company,

Differentiate between trade, commerce business and industry.

0 Answers

What will u conclude from P&L A/C?

4 Answers Capital IQ,

I am studing in MEB(MBA+IT), In our course there is no specialation and I want to go in finance, in june-july i am going to do intersip program so what would i do to make arrengement for my summer training

0 Answers

How many series of consumer price index (cpi) are there?

0 Answers

What are the limitations of ratio analysis?

0 Answers

Does solvency margin in Life Insurance is invested into any funds?

1 Answers

PLEASE SEND MODEL QUESTIAN PAPER TO MY EMAIL salimallappra@gmail.com

0 Answers State Bank Of India SBI,

What are the top fifty companies in nifty and top thirty companies in sensex?

0 Answers

entrance exam