K1 and K2 are two similar plants under the same management who want them to be merged for better operation. The details of K1 and K2 are as follows:

K1

K2

Capacity Utilization

90%

60%

Sales

Rs. 6,30,000

Rs. 3,60,000

Variable Cost

Rs. 3,60,000

Rs. 2,40,000

Fixed Cost

Rs. 1,20,000

Rs. 80,000

Find out:

  1. BEPS of the merged plant and capacity utilization for achieving BEPS.
  2. Profitability of the merged plant at 80% capacity.
  3. Sales of the merged plant to earn a profit of Rs. 1,00,000.