LS2471: A factory manufacturing sewing machines has the capacity to produce 500 machine per annum. The marginal (variable) cost of each machine is Rs. 200 and each machine is sold for Rs. 250. Fixed overheads are Rs. 12,000 per annum. Calculate the break-even points for output and sales and show what profit will result if output is 90% of capacity?

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Question: A factory manufacturing sewing machines has the capacity to produce 500 machine per annum. The marginal (variable) cost of each machine is Rs. 200 and each machine is sold for Rs. 250. Fixed overheads are Rs. 12,000 per annum. Calculate the break-even points for output and sales and show what profit will result if output is 90% of capacity?

 


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