Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Business Arithmetic

Question:

Following information is related to sales mix of Product A, B and C.

Product A (Rs) (Rs) (Rs)
Sales Price Per Unit 15 21 36
Variable Cost Per Unit 9 14 19
Sales Mix Percentage 20% 20% 60%

Total Fixed Cost= Rs 40,000

What will be the break even point in rupees?

Options:

9,375

13,125

6,7500

90,000

Correct Answer:

90,000

Explanation:

 

Product A (Rs) (Rs) (Rs)
Sales Price Per Unit 15 21 36
Variable Cost Per Unit 9 14 19
Sales Mix Percentage 20% 20% 60%
Product Units at Break Even Point 625 units 625 units 1,875 units
Product sales in Rs 9,375 13,125 67,500

Break Even point in rupees= 9,375+13,125+67,500=90,000