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
Answer Posted / 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 |
Post New Answer View All Answers
Explain different types of bank loans?
What Different Types Of Bankruptcy Should I Consider?
Which banks give preference to nbet candidates?
What are the different types of tools provided to the investors to keep track of the activities going on in the stock market?
Explain the term double bottom?
What is Tax evasion? How can it be curbed?
Explain the concept of finance accounting?
Please tell something about ex-president APJ Kalam. Why he was so popular?
What is the difference between accounting and financial accounting?
The authorized capital of nabard in 2013 was raised up to what limit?
What is Pradhan Mantri Jeevan Jyoti Bima Yojana?
Where is the UNICEF headquarters located?
What is 'electronic fund transfer system' (efts)?
How well can you handle the pressure?
What is fixed assets turnover ratio? What does it indicate?