The following is the budget of ABC Ltd:
|
Particulars |
Fixed Cost |
Variable Cost Rs. |
Total Rs. |
|
Budgeted sales:1,00,000 units @ Rs. 10 per unit |
10,00,000 |
||
|
Budgeted costs: |
|||
|
Direct material |
– |
1,80,000 |
|
|
Direct labour |
– |
2,00,000 |
|
|
Factory overhead |
1,40,000 |
60,000 |
|
|
Administration overhead |
1,20,000 |
20,000 |
|
|
Distribution overhead |
1,00,000 |
60,000 |
|
|
Total |
3,60,000 |
5,20,000 |
8,80,000 |
|
Budgeted profit |
1,20,000 |
Compute the BEPs in the following independent situations, if:
- a 10% increase is effected in the fixed costs.
- a 10% increase is effected in the variable costs.
- a 10% increase is effected in the sales price which will result in a reduction in units sold by 5%.
- a 10% increase in the fixed costs and a 5% decrease in the variable costs is effected.