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Jan-25 Marginal Costing NNC

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104 views141 pages

Jan-25 Marginal Costing NNC

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#CostingbyVR

538
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#CostingbyVR CA Vinod Reddy

539 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

540 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

541 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

542 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

543 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

544 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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#CostingbyVR CA Vinod Reddy

545 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

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CA Inter | Costing | Marginal Costing

BEP

Mos in units 180,0 units 54

20,000units 18,000
95 units
4.

Ihor in contribution
sales 100 110
5
v Wst 60 60 1 100

conti 40 SO 100 25

sales requiredfor desired profit

Desired profit Fixed cost BEP YF
P V Ratio 1600 units
MOS Ratio 4
15,000 75,000 3,000001
8 Scan For Softcopy of Notes
100

#CostingbyVR 301 CA Vinod Reddy

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opening stock in units
CA Inter | Costing | Marginal Costing
closing stock in units
prodnied during no of units sold
during
8.
ie
Effe ff the period

Diff in profit as per absorption

marginal costing
2500 units E 16 4
10,000
10.

per absorptioncosting 1 30,000

profit as
A Diff in value_ofop stock 15000 8 1 20,000
f Diff in value of C1 stock 20,000 8 1 60,000

profit as per Marginalcosting go 000

Formulae to remember
______________________________________________________________________________

Sales P V Ratio contribution

______________________________________________________________________________
sales rati wst ratio vasi cost of
goods sold
______________________________________________________________________________
conbi.P.cl whbibution 100
Plv Ratio 100
______________________________________________________________________________
selling pricepay sales
______________________________________________________________________________
v cost of goodssold
Vari cost Ratio too
______________________________________________________________________________
tgfjkp.ae
x
sales value
______________________________________________________________________________
wnbi.p.ua V wstp.cn
U Ratio v cost Ratio
______________________________________________________________________________
P
selling price p.is selling pricep.us
______________________________________________________________________________

smiling c
______________________________________________________________________________

______________________________________________________________________________
price p u
sellingScan For Softcopy of Notes1.00 100
#CostingbyVR CAselling
price pin
Vinod Reddy
______________________________________________________________________________

548 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

question write down diff between absorption costing

______________________________________________________________________________
Marginal costing
______________________________________________________________________________

Absorption costing Marginal costing

______________________________________________________________________________

Absorption costing is a Marginal costing is a

______________________________________________________________________________

method used mainly for Technique tool used mainly

______________________________________________________________________________

for managerial decision making

______________________________________________________________________________
Accounting
______________________________________________________________________________
Fixed cost is treated as Fixed cost is treated as
______________________________________________________________________________
PRODUCT COST PERIOD COST
______________________________________________________________________________
stock is valued on the stock is valued on the
closing closing
______________________________________________________________________________
basis of basis of
______________________________________________________________________________
production
Total cost of production variable cost of
______________________________________________________________________________
stock value will be higher stock value will be lower
______________________________________________________________________________
as compared to marginal as compared to absorption
______________________________________________________________________________
costing costing
______________________________________________________________________________
rewards sales
rewards production
It shows higher profit as
______________________________________________________________________________
It shows higher profit as
compared to marginal costing compared to Absorptioncosting
______________________________________________________________________________
when when
______________________________________________________________________________
No_ofunits produced 58 1
list piida fi
______________________________________________________________________________
during the period 9
the period
the period
______________________________________________________________________________

______________________________________________________________________________

Additional Question
______________________________________________________________________________

selling price V cost p.cl Its

______________________________________________________________________________
p.cl 2S

I so latchs
______________________________________________________________________________
Fixed cost for the period
No of units sold during the period 12 00,000
______________________________________________________________________________

Mos in units amt profit

______________________________________________________________________________
Find
______________________________________________________________________________
Fiteed cost for the period
______________________________________________________________________________
Break even point contribution per unit
Scan For Softcopy of Notes
in units
#CostingbyVR CA Vinod Reddy
______________________________________________________________________________

549 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

5000,000 units
500,000
______________________________________________________________________________
10 p.cl
______________________________________________________________________________
500,000 units
2S
i Break even sales
______________________________________________________________________________
I 125,00 0004
______________________________________________________________________________
ORG
______________________________________________________________________________
Break even sales Fixed cost for the period
______________________________________________________________________________
Ratio
PIU
50,00 000
______________________________________________________________________________
I 50,00 000
1 5 40
______________________________________________________________________________

1,25 00,000
______________________________________________________________________________

Margin of safety in units fagglesales PEuffles

______________________________________________________________________________

______________________________________________________________________________
12100,000 500,000 units 700,000
units
______________________________________________________________________________
inant Actual sales B E sales
Margin of safety
______________________________________________________________________________

12,00000 525 1,25 00,000

______________________________________________________________________________

1,25 00,000
______________________________________________________________________________
3,0000,000
1,7500,000
______________________________________________________________________________
it
profit for the Fixed cost
______________________________________________________________________________
v wstp.in x
fs.p.p.ua
period
______________________________________________________________________________

______________________________________________________________________________
25 15 12.00.000 units 50,00 000
______________________________________________________________________________
I 70,00 000
______________________________________________________________________________

Mos sales Plv Ratio

______________________________________________________________________________
profit 70 00,000
1,75 00,000 40
______________________________________________________________________________

______________________________________________________________________________

B E sales
______________________________________________________________________________

Total sales 1,2500,000 40 50,00 000

______________________________________________________________________________

3,0000,000
______________________________________________________________________________

______________________________________________________________________________
J MOS sales Scan For Softcopy of Notes

#CostingbyVR
70
00,000
CA Vinod Reddy
______________________________________________________________________________
40
1,7500,000
1,20 00,000
550 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

Mos sales Plu Ratio profit

______________________________________________________________________________

______________________________________________________________________________
profit Mos sales
______________________________________________________________________________
Pluratio
______________________________________________________________________________
Profit 100 P V Ratio
______________________________________________________________________________
sales
Mos
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

551 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

______________________________________________________________________________
Marginal Costing & CVP Analysis
______________________________________________________________________________
Marginal costing cost volume profit analysis
______________________________________________________________________________
Decision making
______________________________________________________________________________

costing is one of the most important

______________________________________________________________________________
Marginal
used for managerial decision making
______________________________________________________________________________
Technique of costing
make or buy decisions continue or
______________________________________________________________________________
examples
mise decisions
shut down decisions optimum product
______________________________________________________________________________

own vs
selling Dealership decisions
______________________________________________________________________________
etc
______________________________________________________________________________
cost Additionalcost Incremental cost
Marginal
______________________________________________________________________________
Differential wst variable cost
______________________________________________________________________________
able
fine v8
______________________________________________________________________________

______________________________________________________________________________
EYES FFin
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Marginal cost
TC Jan
1 units
______________________________________________________________________________
n units
of producing nth unit
______________________________________________________________________________

Total Sales Total cost profit

______________________________________________________________________________

variable cost Fixed cost profit

______________________________________________________________________________
Total sales
______________________________________________________________________________
Total sales variable cost Fixed cost profit
______________________________________________________________________________

contribution Fixed cost profit

______________________________________________________________________________

pls variable includes cost variable on

______________________________________________________________________________
Note
cost prime
______________________________________________________________________________

includes variable Admin

______________________________________________________________________________
Factory
Distri etc
______________________________________________________________________________
selling mktg
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

552 vinod.reddy.ca@gmail.com
MARGINAL COSTING FORMAT
______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

Sales In Marginal costing

______________________________________________________________________________
variable cost of Fixed cost is treated
______________________________________________________________________________
goods sold as
______________________________________________________________________________
contribution a b XX PERIOD COST
______________________________________________________________________________
Fixed cost for X
sales
contribution
______________________________________________________________________________
the period
______________________________________________________________________________
profit for the XX sales contribution
______________________________________________________________________________ d
period c d
contribution
profit
______________________________________________________________________________
costFixed
______________________________________________________________________________
contribution profit Fixed cost
______________________________________________________________________________
cost
costing treats Fixed product
cost as
Absorption
______________________________________________________________________________

whereas costing treats fixed cost as period cost

______________________________________________________________________________
marginal
______________________________________________________________________________

______________________________________________________________________________

Question 1:

Direct material cost p.u. = ₹13

Direct labour cost p.u. = ₹28
Variable OH cost p.u. = ₹31 variable Factory 0H cost P 4
Fixed Factory OH for the year = ₹10,00,000
Selling price p.u. = ₹150
Find proﬁt under a) Absorption costing b) Marginal costing
if No. of units sold are 20,000 where as No. of units produced are 25,000

Marginal costing
______________________________________________________________________________
for
profit sales vasi cost of
goods In
______________________________________________________________________________
sold ft
______________________________________________________________________________
sales 89 x EY't 1000,000
______________________________________________________________________________

I 10 00,000
#CostingbyVR 13 28731
CA Vinod Reddy
______________________________________________________________________________
20,000 units 150 20,000

553 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

72 P Y X 20,000units 10,001000
30100,000
______________________________________________________________________________

30100,000 14 40,000 1000,000 1560,000 10,0900

______________________________________________________________________________

I 560,0001
______________________________________________________________________________
pls Note
Total contribution ftp.nb tionxNo.ofunits
______________________________________________________________________________
sold
______________________________________________________________________________
Absorptioncosting
______________________________________________________________________________

particulars Amount I
______________________________________________________________________________

Direct material cost 25000 units 13 D 4 3,25000

______________________________________________________________________________

Direct Labour cost 25000 units 28 P 4 700,000

______________________________________________________________________________

prime cost atb 10 25,000

______________________________________________________________________________

Factory 0H
______________________________________________________________________________
variable 0H E 31 25000 units 7 75,000
______________________________________________________________________________
Fixed Factory OH 10 00,000
______________________________________________________________________________
sub total 1775,000
______________________________________________________________________________
cost of production of 25000 units Std 28,00 000
5,000 5 60,000
closing stock 28,00 000 25,000
______________________________________________________________________________

cost of goods sold e f 22,40 000

______________________________________________________________________________

Sales 20,000 units 150 P 4 30 00,000

______________________________________________________________________________

profit h g 760,000
Question 2:

Selling price p.u. = ₹50

Variable cost p.u. = ₹20
Fixed cost for the period = ₹1,00,000
No. of units produced = 10,000
No. of units sold = 0
Find proﬁt as per Absorption costing &
proﬁt as per Marginal costing.

profitability statement as per absorption costing

______________________________________________________________________________

#CostingbyVR
Fixed wst CA Vinod Reddy
______________________________________________________________________________
1,00 000
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CA Inter | Costing | Marginal Costing

Total cost of producing 10,000 3 00,000

______________________________________________________________________________
units atb
______________________________________________________________________________

closing stock value 309000

______________________________________________________________________________

units 10,000 units

______________________________________________________________________________
300,000 10,000
______________________________________________________________________________
c d 0
COGS
______________________________________________________________________________

sales
______________________________________________________________________________

______________________________________________________________________________
profit f e 0
______________________________________________________________________________

profitability statement as per marginal costing

______________________________________________________________________________

______________________________________________________________________________
Amt E
particulars
______________________________________________________________________________
sales
variable cost of goodssold
______________________________________________________________________________
0
______________________________________________________________________________
contribution ab 0
for
the period
______________________________________________________________________________
Fixed cost for the period 1 00,000
______________________________________________________________________________
profit Loss for the
1,00 000
______________________________________________________________________________
period s d
______________________________________________________________________________

______________________________________________________________________________

stock is valued at
______________________________________________________________________________
As per
absorptingcosting closing
Total cost of production
______________________________________________________________________________

______________________________________________________________________________
whereas
______________________________________________________________________________
is valued at
As per Marginal costing closing stock
______________________________________________________________________________

variable cost of production

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

555 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question :

What is diﬀerence between absorption costing & marginal costing

Absorption costing Marginal costing

1) It is a method mainly used for accounting 1) It is a Technique / tool used mainly for
purpose managerial decision making

2) Here 2) Here
Fixed cost is treated as: PRODUCT COST Fixed cost is treated as: PERIOD COST

3) Stock is valued at Total cost of production 3) Stock is valued at variable cost of production

4) Stock is value is higher in comparison with 4) Stock is value is lower in comparison with
marginal costing absorption costing

5) Absorption costing rewards the production 5) Marginal costing rewards the sales

6) Absorption costing shows higher proﬁt 6) Marginal costing shows higher proﬁt
when when

( No. of units produced

during the period )(No. of units sold
during the period )( No. of units sold
during the period) ( No. of units produced
during the period )
Question
______________________________________________________________________________
25 variable cost p.cn 20
sellingprice p u
______________________________________________________________________________
cost for the
Fixed 2,00 000
period
______________________________________________________________________________
No_of units produced No of units
1 00,000 50,000 sold
Find profit as per absorption costing Marginal costing
______________________________________________________________________________

Absorption costing Marginal costing

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________
particulars Amt E
variable cost of production 20,00 000
______________________________________________________________________________
selling price p 4 25
120 P.M 100,000 vasi.wstp.lt 20
______________________________________________________________________________
Fixed cost of pudh 200,000 contribution P U a b s
______________________________________________________________________________
Total cost of prudh atb 22,00 000
No_of units sold 50,000
______________________________________________________________________________
closingstock E22p.us 11 00,000
units Total wnbi.fr the 2 50,000
______________________________________________________________________________
22
50,000
1100,000 period xd
COGS r d
______________________________________________________________________________
Fired wst for the
00,000 2
Sales 50,000 725 12 50,000 period
______________________________________________________________________________

50,000
profitScan For Softcopy of Notes
as per
______________________________________________________________________________
1 50,000
profit as per
e f
#CostingbyVR CA Vinod Reddy
marginalwsting
______________________________________________________________________________
absorption costing
f e
556 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 3:

profitability statement as per absorptioncosting

______________________________________________________________________________
particulars Amt Amt E
______________________________________________________________________________
Direct material cost 10,000 units 10
100,000
______________________________________________________________________________
Direct Labour cost 10,000units 6 60,000
______________________________________________________________________________
1 60,000
prime cost atb
Factory overheads 60,000
______________________________________________________________________________

9 10,000units 4 40,000
______________________________________________________________________________
20,000
______________________________________________________________________________
Total cost of production of 10,000 units 2,20 000
Ctd
______________________________________________________________________________

closingstock 220,000 10,000 2000 44,000

______________________________________________________________________________
COGS e t 1 76,000
______________________________________________________________________________
Sales 8000 units 250 20 00,000
______________________________________________________________________________
profit h g 18,29000
______________________________________________________________________________
profitability statement as per marginal costing
______________________________________________________________________________
particulars Amt
Sales value 250 P U 8000 units 20,00 000
______________________________________________________________________________
Varicost of goods soldlot 6 4 8000units
60,000 1
______________________________________________________________________________
contribution for the period a b 18,40 000
______________________________________________________________________________
Fixed cost for the period 20,000
______________________________________________________________________________
for the period r d 18 20,000
profit
______________________________________________________________________________

Reconciliation statement of profit

______________________________________________________________________________

______________________________________________________________________________
particulars Amt E
profit
as per absorption
costing 24,000 18
______________________________________________________________________________
Less Diff in valuation of
closing stock 9,000
______________________________________________________________________________
2000 20
44,000
______________________________________________________________________________
profit as per costing 18 20,000
marginal Scan For Softcopy of Notes
______________________________________________________________________________
#CostingbyVR CA Vinod Reddy
557 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 4:

Factory

selling price p u

Profitability statement as per absorption costing

______________________________________________________________________________

particulars Amt
______________________________________________________________________________
E
______________________________________________________________________________
Direct material cost E3 p.cn 20,000 60,000
______________________________________________________________________________
Direct Labour cost ESP 4 20,000 1,00 000
______________________________________________________________________________
1 60,000
prime cost atb
______________________________________________________________________________
0H
Factory
______________________________________________________________________________
variable 8 P y 20,000 1,60 000
Fixed
______________________________________________________________________________
60,000
sub total 2,20 000
______________________________________________________________________________

Total cost of production Ctd 3 80,000

______________________________________________________________________________

closing stock value

I 9 370,500
______________________________________________________________________________

______________________________________________________________________________

COGS e f 9,500
______________________________________________________________________________

500 units 6 3,000

selling
______________________________________________________________________________
expenses
of sales th 12,500
______________________________________________________________________________
cost g
sales 500 units 35 17,500
______________________________________________________________________________

profit i i
______________________________________________________________________________
5,000
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

558 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

profitability statement as per marginal costing

______________________________________________________________________________

Amt I
______________________________________________________________________________
Amt E
particulars
______________________________________________________________________________
selling price p u 35
______________________________________________________________________________
variable cost P U 22
______________________________________________________________________________
i Direct material cost 3
______________________________________________________________________________
Ii Direct labour cost s

ini selling exp 6

______________________________________________________________________________
iv vasi Factory on wst 8
______________________________________________________________________________

contribution P.cn 9 b 13
______________________________________________________________________________

No of units sold in quarter soo

______________________________________________________________________________

Total contribution for the 6,500

______________________________________________________________________________

Quarter exd
______________________________________________________________________________
Fixed cost for the Quarter 60,000
______________________________________________________________________________

for the
profit c Loss 153,500
______________________________________________________________________________

period e f
______________________________________________________________________________

Reconciliation statement of profit

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

profit as per absorption costing 5,000

______________________________________________________________________________

Diff in valuation of d stock 58,500

______________________________________________________________________________
Less
______________________________________________________________________________
1 stock value as per 500
3,70
______________________________________________________________________________
absorption costing
______________________________________________________________________________
c stock value as per 3 5 8
______________________________________________________________________________
marginal costing 19,500
______________________________________________________________________________
3 12,000
______________________________________________________________________________

profit as per marginal costing 53,500

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

559 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 5:

profitability statement as per absorption costing

______________________________________________________________________________

Prime cost atb 500,000

______________________________________________________________________________
Factory overheads
______________________________________________________________________________
variable 4 00,000
______________________________________________________________________________
Fixed 500,000
sub total 9 00,000
______________________________________________________________________________

Total cost of production ctd 1400,000

______________________________________________________________________________

closing stock value 14,8 280,000

95 25
______________________________________________________________________________

______________________________________________________________________________
COGS e f 1120,000
______________________________________________________________________________
Sales 8000 units 200 1600,000
______________________________________________________________________________

profit h g 4 80,000
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

560 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

profitability statement as per marginal costing

______________________________________________________________________________

Amt E
______________________________________________________________________________
Amt E
particulars
______________________________________________________________________________
Sales 8000 units 200 1600,000
______________________________________________________________________________
variable cost of goodssold
______________________________________________________________________________
1
i material wst 8000 60,000
4 8
______________________________________________________________________________

8000 290,000
______________________________________________________________________________
Ii Labour wst 31 8
______________________________________________________________________________
4 0 8000 320,000
Iii Factory 8
yay
______________________________________________________________________________

______________________________________________________________________________
contribution for the year 8 80,000
______________________________________________________________________________
a b
______________________________________________________________________________
Fixed cost for the year 500,000
______________________________________________________________________________
for the Year 3 80,000
profit
______________________________________________________________________________
r d
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Reconciliation statement of profit
______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

absorption costing 4 80,000

______________________________________________________________________________
profit as per
______________________________________________________________________________
Less Diff in valuation of d stock 1 00,000
______________________________________________________________________________
c1stock value as per 2 80,000
______________________________________________________________________________
absorption costing
______________________________________________________________________________
c stock value as per 20 30 40
______________________________________________________________________________
marginal costing
3 8
______________________________________________________________________________
1 80,000
______________________________________________________________________________

3 80,000
profit marginal costing
______________________________________________________________________________
as per
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

561 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 6:

profitability statement as per Marginal costing

______________________________________________________________________________

No_of units sold

______________________________________________________________________________
particulars
50,000 1 00,000
______________________________________________________________________________
20 00,000
Sales value
______________________________________________________________________________
20 p u 10100,000
20
IE 50,000 720 1 00,000
______________________________________________________________________________

variable cost sold

______________________________________________________________________________
goods
______________________________________________________________________________
i Direct materials I 3Pa 1150,000 3
00,000
______________________________________________________________________________
Ii Direct Labour 2 p.cl 1 00,000 2 00,000
______________________________________________________________________________
Iii vati.FactoryoH EI.sop.cl 75,000 1 50,000
______________________________________________________________________________
iv vasi.sellingesep E2p.gr 1 00,000 2
00,000
______________________________________________________________________________
sub total 4 25,000 8
50,000
______________________________________________________________________________

Total contribution a b 575,000 11 50,000

______________________________________________________________________________

Fixed cost
______________________________________________________________________________
i Fixed Factory OH 1 00,000 1,00 000
______________________________________________________________________________
Ii Fixed selling OH 2,00 000 200,000
total 300,000 3 00,000
______________________________________________________________________________
sub
profit c d 2
75,000 8 50,000
______________________________________________________________________________
Fees per student 20,000 v cost per student 2000
______________________________________________________________________________
Revenue
______________________________________________________________________________
wnbi student
per 18,000
Fixed cost 40,00 0001
______________________________________________________________________________
No of students 0 100 200 400 800 1600
______________________________________________________________________________
Total contribution 0 18100,000 36,00000 72,00000 1,4400,000 2,8800,000
______________________________________________________________________________
Less Fired wst 4000,000 40,00000 4000,000 4000,000 4000,000 40 00,000
______________________________________________________________________________
profit Loss 40,00000 22,00 32For
000 4,00000Scan 00,000 1,04
Softcopy Notes 2,4800,000
of00,000

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

562 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 7:

Selling price p.u. = ₹20

Variable cost p.u. = ₹8
No. of units sold during the year = 25,000
Find contribution p.u., proﬁt - volume ratio, variable cost ratio,
Total contribution for the year.

variable wstp.cn
contribution per unit price p.cl
selling
______________________________________________________________________________

20 8 I 12
______________________________________________________________________________

______________________________________________________________________________
profit volume Ratio contribution expressed as of
______________________________________________________________________________
sales is known as P V Ratio
______________________________________________________________________________
contribution p.is
PIV Ratio 100
______________________________________________________________________________
selling price p.ie
______________________________________________________________________________
60
If
100
______________________________________________________________________________

contribution P U No_ofunits sold

______________________________________________________________________________
profit volume Ratio
price P U no of units sold
______________________________________________________________________________
selling
______________________________________________________________________________
o
no
______________________________________________________________________________

Plu Ratio contribution D

______________________________________________________________________________ u
selling price p.u
______________________________________________________________________________
anti.ru selling price pin
patio
______________________________________________________________________________

______________________________________________________________________________
variable cost Ratio variable cost of goods sold
______________________________________________________________________________
expressed as a of sales is known as
______________________________________________________________________________
variable cost ratio
______________________________________________________________________________
variable wstp.us 100
variable cost ratio
______________________________________________________________________________
selling price p.cn
______________________________________________________________________________

Ef 100 40
______________________________________________________________________________
variable wst P U no_of units sold
variable cost Ratio
______________________________________________________________________________
10
selling price p n no_of units sold
______________________________________________________________________________
V cost of goods Scan For Softcopy sold
of Notes

#CostingbyVR 1 Reddy
CA Vinod
100
______________________________________________________________________________
sales value
563 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

variable cost P.y price p.ir vasi cost Ratio

selling
______________________________________________________________________________

______________________________________________________________________________
vasi cost p.ir
selling price P U
v Wst Ratio
______________________________________________________________________________

sold sales value v cost ratio

______________________________________________________________________________
variable cost of goods
______________________________________________________________________________
variable cost of goods sold valuesales
______________________________________________________________________________
vasi cost ratio
______________________________________________________________________________
Total contribution for the
year
______________________________________________________________________________
sales value vari cost of goods sold
______________________________________________________________________________
220 25000 units 8 25,000 units 3,00 000
______________________________________________________________________________
ORG
Ratio I 500,000 601 3,00 000
______________________________________________________________________________
Sales P V
______________________________________________________________________________

Question 8:

Sales = ₹ 20,50,000
Variable cost ratio = 40%
Fixed cost for the period = ₹ 2,21,500/-
Find a) P/V Ratio b) Variable cost of goods sold
c) Contribution d) Proﬁt

P r Ratio variable cost Ratio 1.00

______________________________________________________________________________

1 00
______________________________________________________________________________
0.40
P V Ratio t
0.40 0.60 60
______________________________________________________________________________
Ratio 1.00
PV
______________________________________________________________________________

goods sold sales value

variable cost of
______________________________________________________________________________ 2 yst
000 8,20
______________________________________________________________________________
20 50,000 40
______________________________________________________________________________

cost of goods sold sales value contribution

______________________________________________________________________________
variable
sales value sales PIV Ratio
______________________________________________________________________________

20 50,000 60
______________________________________________________________________________
2050,000
Scan For Softcopy of Notes
20 50,000 12,30 000
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contribution for the period

______________________________________________________________________________

sales pluratio 20
50,000 60 1230,0001
______________________________________________________________________________

OR
______________________________________________________________________________
sold 20 20,000 8
sales V wst of goods 50,000
______________________________________________________________________________

12,30 0001
______________________________________________________________________________

______________________________________________________________________________

profit for the period

______________________________________________________________________________
contribution for the period Fixed cost for
______________________________________________________________________________
the period
500
1230,000 2,21
______________________________________________________________________________

E 10 08,5004
______________________________________________________________________________

______________________________________________________________________________

Question 9:

Selling price p.u. = ₹ 30

Variable cost p.u. = ₹ 9
Fixed cost for the period = ₹ 4,20,000/-
Find Break even point (in units & amount)

Let se units be Break even point

It
______________________________________________________________________________
means if we sell se units there will
______________________________________________________________________________
be No profit
or no Loss contribution Fixed cost
______________________________________________________________________________
For Break even
Desired
______________________________________________________________________________

8 19pm e
i e
Eiffel.in
______________________________________________________________________________
Etse se
______________________________________________________________________________

S.P.P.U v.wstp.u Fixed cost

______________________________________________________________________________

______________________________________________________________________________
Fixed cost
se x wntri.p.ir
______________________________________________________________________________
i
______________________________________________________________________________

in units Fixed wst contribution pin

______________________________________________________________________________
BEP Scan For Softcopy of Notes

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20,000 4
in units
______________________________________________________________________________
B E P
30 Eg
______________________________________________________________________________
9219T
Break even sales volume 20,000 units
______________________________________________________________________________

______________________________________________________________________________
B E P in amount BE p in selling
units pricep.us
______________________________________________________________________________
units 000
Break even sales 20,000 30 6,00
______________________________________________________________________________

______________________________________________________________________________
Break even point BE p in units price p u
selling
______________________________________________________________________________
in amount
Fixed cost for the period
price
______________________________________________________________________________
spelling
contribution
p.cl
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the period
______________________________________________________________________________

______________________________________________________________________________
41201 E 6 00,0001
B E sales
ftp.ffpff
______________________________________________________________________________

______________________________________________________________________________

Question 10:

Selling price p.u. = ₹ 30 Fixed cost won't

Variable cost p.u. = ₹ 5 change up to 200,000
Fixed cost for the period = ₹ 15,00,000/-
units
Normal capacity for the period = 2,00,000 units Scan For Softcopy of Notes

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Find Break even point (in units, in amount, in capacity)

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Fired wst for the

______________________________________________________________________________period
Break even point in units contribution per unit
______________________________________________________________________________

15,00 000
______________________________________________________________________________

selling price p u v.wstp.ae f

______________________________________________________________________________

______________________________________________________________________________
units
15218s 60,000
______________________________________________________________________________
fired wst for the period
Break even point in amount
______________________________________________________________________________
P V Ratio
______________________________________________________________________________

15,00 000 1500,000

______________________________________________________________________________

wntri.p.us sellingpricep n 225 2 30

______________________________________________________________________________

______________________________________________________________________________
000 15,001000
15,00 18,00 000
0 833333333 83
______________________________________________________________________________

Break even point in capacity BEP in units

______________________________________________________________________________
100
Normalcapacity in
______________________________________________________________________________
units
60,000 units
______________________________________________________________________________
30
100
2100,000 units
______________________________________________________________________________

ORG
______________________________________________________________________________
Fixed cost
BEP 1509000 30
______________________________________________________________________________ at 1
in lapacity 200,000 units 1 25 ganghaffon
______________________________________________________________________________

wntoi.at ii capacity Normalcap.inunits 1

______________________________________________________________________________
where eh
______________________________________________________________________________
Break event point
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
in units in amount in capacity
______________________________________________________________________________
for the for the for the
Effffawst fifffawst
______________________________________________________________________________
fiefdawst
______________________________________________________________________________
contribution pin P V Ratio contri.at 1
capacity
______________________________________________________________________________
Scan For Softcopy of Notes

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Question 11:

Statement showing calculation of Break even point

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

unit
selling price per 10
______________________________________________________________________________

8
______________________________________________________________________________
Variable cost p.cl
contribution p.cl a b 2
______________________________________________________________________________

______________________________________________________________________________
20
profit volume Ratio9 100

Normal for the period 1 00,000 units

______________________________________________________________________________
capacity
______________________________________________________________________________
contribution at 1 capacity 2,000
______________________________________________________________________________
exit c
______________________________________________________________________________

Fixedcost for period

______________________________________________________________________________
the 50,000
______________________________________________________________________________
Break point in units
25,000 units
even
______________________________________________________________________________
9 4
______________________________________________________________________________
Break even point in amount 2 50,000
______________________________________________________________________________

9 d OR axh
______________________________________________________________________________

______________________________________________________________________________
Break even point in capacity 25
______________________________________________________________________________
7 100
9 or 4
______________________________________________________________________________

______________________________________________________________________________

Question 12:

Scan For Softcopy of Notes

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CA Inter | Costing | Marginal Costing

Calculation of net return after tax to sales

Ratio
______________________________________________________________________________

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

______________________________________________________________________________
Sales value for
the year 1 00,000
Plu Ratio 30
______________________________________________________________________________

contribution for
the ax b 30,000
______________________________________________________________________________
year
Fixed cost for the year
______________________________________________________________________________
20,000
profit before tax c d 10,000
______________________________________________________________________________

tax 3,000
______________________________________________________________________________
Income ex 30

profitafter tax e f 7,000

______________________________________________________________________________
Net returnafter tax
______________________________________________________________________________
Net return after tax to sales ratio 7.00
______________________________________________________________________________
9 9 100
______________________________________________________________________________
Additional Question
______________________________________________________________________________
vasi.wstp.cl IS
selling price p.cl 20
______________________________________________________________________________
Fixed cost for the penod I 750,000
______________________________________________________________________________
No of units sold 200,000
Find BEP Margin of safety in units amount
______________________________________________________________________________

______________________________________________________________________________
inunits Fixed cost wnbi.ru 750,000
BE p
______________________________________________________________________________
15
98
in units Actual sales volume B E sales volum
Margin of safety
______________________________________________________________________________
1 50,000 units
200,000 50,000
______________________________________________________________________________
BE p in amount 50,000 units 20 I 10,000001
______________________________________________________________________________

of in amount Actual sales B E sales

Margin safety
______________________________________________________________________________

20 10,00 000 30 00,000

______________________________________________________________________________
2,00 000 units
Question 13:

Selling price p.u. = ₹ 60

Variable cost p.u. = ₹ 24
Fixed cost for the period = ₹ 7,56,000/-
No. of units sold during the period = 28,000 units
Find a) Break even point (in units & amount) Scan For Softcopy of Notes

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b) Margin of safety (in units & amount)
CA Vinod
Find MosReddy
Also Ratio
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CA Inter | Costing | Marginal Costing

Statement showing calculation of BEP Margin of safety

______________________________________________________________________________

______________________________________________________________________________
E
particulars Amount
______________________________________________________________________________
selling price p.cl 60
______________________________________________________________________________
variable cost P U 24
______________________________________________________________________________

contribution p.u.la b 36
______________________________________________________________________________

volume Ratio ca 100 60

profit
______________________________________________________________________________
7 56,000
Fixed cost for the period
______________________________________________________________________________

Break even point in units ex 21,000 units

______________________________________________________________________________

______________________________________________________________________________
Break even point in amount eld OR 1260,000
______________________________________________________________________________
ax f
______________________________________________________________________________
units
Actual sales volume for the period 28,000
______________________________________________________________________________
Actual sales value ax h 16 80,000
______________________________________________________________________________

in units h f 7000 units

Margin of safety
______________________________________________________________________________

______________________________________________________________________________
Margin of safety sales i g or ax 920,000
______________________________________________________________________________

MOS Ratio
safety Ratio
of 25.00
______________________________________________________________________________
Margin
______________________________________________________________________________
sales expressed
Margin of safety
______________________________________________________________________________
as of total sales is known as
MOS Ratio
______________________________________________________________________________

Margin of safety sales

______________________________________________________________________________
10
Total sales
______________________________________________________________________________

______________________________________________________________________________

5 88 100 or
______________________________________________________________________________

______________________________________________________________________________
At this stage if mos ratio is 25 means
______________________________________________________________________________
Scan For Softcopy of Notes
sales B E Sales are 75 of Total
#CostingbyVR of Total
CA Vinod Reddy
______________________________________________________________________________
Mos sales are 25
sales
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Question 14:

Selling price p.u. = ₹55

Variable cost p.u. = ₹44
Fixed cost for the period = ₹ 5,72,000
Find No. of units to be sold, sales value, capacity to be used if desired proﬁt is ₹ 2,75,000
(Normal capacity = 1,50,000 units)

Let ae units be No of units to be sold

______________________________________________________________________________
to earn

profitof 2,75000
______________________________________________________________________________

No_of units to be sold for desired

______________________________________________________________________________
i e.ae profit
______________________________________________________________________________
wst goods Fixed cost Desired profit
sales vasi cost of
______________________________________________________________________________

552 442 Desired profit Fixed cost

______________________________________________________________________________

55 44 Desired profit Fixed cost

______________________________________________________________________________
a

Desired profit Fixed cost

______________________________________________________________________________
a
55 44
______________________________________________________________________________

No_of units to be sold Desired Fixed

profit
______________________________________________________________________________
cost
for desired profit contribution p.cl
______________________________________________________________________________

ofunits to be sold 2175,000 972,000

______________________________________________________________________________
No
77,000 units
for desired profit 11
______________________________________________________________________________

______________________________________________________________________________
Sales required for No_of units to be sold
selling price p.in
desired profit for desired profit
______________________________________________________________________________

______________________________________________________________________________
Desired profit Fixed wst
sellingpricep u
contribution p.cl
______________________________________________________________________________
iseedwst
t
______________________________________________________________________________
ftp.ut.isfngdm fesiredpnft
______________________________________________________________________________

2,75000T 5,72000 42 35,000

Desired profitFixed cost 49000 I 5.72.000

______________________________________________________________________________

wnbi.at 1 capacity 150,000units x 1 11

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod51 Reddy

______________________________________________________________________________
28,47000 2 16,500 51.333333
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desired profit
______________________________________________________________________________
For
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
No_ofunits to
capacity to be
______________________________________________________________________________
be sold
used
______________________________________________________________________________

II sales required
p
______________________________________________________________________________
OR
______________________________________________________________________________
h
I
turnover required
contribution at 1
______________________________________________________________________________
capacity
II
______________________________________________________________________________

FEED
______________________________________________________________________________
Plu Ratio
______________________________________________________________________________

where contribution at 1 capacity

1 contribution p.us
Question 15: Normal capacity in units
Selling price p.u. = ₹15
Variable cost p.u. = ₹5
Fixed cost for the period = ₹ 5,00,000
No. of units sold during the period = 80,000
Find 1) Break even point
2) Margin of safety (in units & amount)
3) Mos Ratio or % of marginal safety

______________________________________________________________________________
Break even point in units
______________________________________________________________________________
Fixed cost for the period 5
00,000
______________________________________________________________________________
contri P U 1S IS
______________________________________________________________________________
units
50,000
______________________________________________________________________________

Breakeven sales 50,000 units 1S

______________________________________________________________________________

750,000
______________________________________________________________________________

of safety in units
______________________________________________________________________________
Margin
Actual sales volume BEP in units
______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR units
CA
units
Vinod Reddy
30,000 units
______________________________________________________________________________
80,000 50,000
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CA Inter | Costing | Marginal Costing

i of sales
safety
______________________________________________________________________________
Margin
______________________________________________________________________________
Mos in units selling price p.ci
I15 p.m 9 50,0001
______________________________________________________________________________
30,000 units
______________________________________________________________________________

Mos Ratio OR of safety

______________________________________________________________________________
margin
______________________________________________________________________________
Mos sales 100
______________________________________________________________________________
Total sales
______________________________________________________________________________

4,50 000
______________________________________________________________________________
100 37.50
I 1200,000
______________________________________________________________________________

______________________________________________________________________________

3 This 100 37.50

______________________________________________________________________________

Mos Ratio is also known as of safety

______________________________________________________________________________
Margin
______________________________________________________________________________

______________________________________________________________________________
Total sales 50 00,000 30100,000 Plv Ratio profit
______________________________________________________________________________

Margin of safety sales 30 00,000

______________________________________________________________________________

______________________________________________________________________________
Breakeven sales 20 00,000 20,00 000 XP V Ratio
Fixed cost
______________________________________________________________________________

______________________________________________________________________________
zero sales
______________________________________________________________________________
Fixed cost
B E Sales
______________________________________________________________________________
Pv Ratio
______________________________________________________________________________

Fixed cost B E Sales Plv Ratio

______________________________________________________________________________

plu Ratio Total sales BE sales PIV Ratio

sales
______________________________________________________________________________
Mos
Total sales Xp v Ratio BE sales Plv Ratio
______________________________________________________________________________

Total contribution fixed cost profit

Scan For Softcopy of Notes

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Question 16:

selling price p.cn

Also prepare reconciliation statement of profit
______________________________________________________________________________

statement as per costing

absorption
______________________________________________________________________________
profitability
______________________________________________________________________________
Amt E
particulars
______________________________________________________________________________
variable cost of production of 500,000
______________________________________________________________________________
units
20,000
______________________________________________________________________________
000
Fixed cost of podh 2,00
______________________________________________________________________________

Total cost of production atb 700,000

______________________________________________________________________________

______________________________________________________________________________
closing stock 700,000 0 350,000
29000 units
19
______________________________________________________________________________

______________________________________________________________________________
d 3 50,000
COGS
______________________________________________________________________________

sales value 10,000 units 100 10,00 000

______________________________________________________________________________

6 50,000
______________________________________________________________________________
profit f e
______________________________________________________________________________

profitability statement as per costing

marginal
______________________________________________________________________________

Amt E
______________________________________________________________________________
particulars
Sales value 10,000 units
______________________________________________________________________________
100 10,00 000
______________________________________________________________________________
2 50,000
Vasi cost of goods sold
______________________________________________________________________________
38 8 10,000 units
______________________________________________________________________________
7 50,000
contribution for
the period a b
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the period 2 00,000
______________________________________________________________________________
Scan For Softcopy of Notes
profit for the period c d 550,000
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CA Inter | Costing | Marginal Costing

______________________________________________________________________________
Reconciliation statement of profit
______________________________________________________________________________
particulars Amt E
______________________________________________________________________________
6 50,000
Profit as per absorption costing
______________________________________________________________________________

Diff in valuation of closing 1,00 000

______________________________________________________________________________
Less
stock
______________________________________________________________________________
Cl stock value as per absorption costing 3 50,000
______________________________________________________________________________
d stock value as per marginal costing 250,000
______________________________________________________________________________
500,000 10,000 units
______________________________________________________________________________
20,000
profit as per marginal costing 550,000
______________________________________________________________________________

______________________________________________________________________________

Question 17:

______________________________________________________________________________
contribution p.cn selling price PU v cost p.in
______________________________________________________________________________
20 8 12
______________________________________________________________________________

Total contribution contain p.cl No of units sold

______________________________________________________________________________
12 2000 units 24,000
______________________________________________________________________________
V wstp.cl 901
Vasi cost ratio
10 1001
______________________________________________________________________________
sellingprice py
______________________________________________________________________________
wnbi.P.cl
______________________________________________________________________________
1001 601
profit volume ratio 10
selling pricepin
______________________________________________________________________________

______________________________________________________________________________

vasi cost ratio P V Ratio 100

______________________________________________________________________________
i PIV Ratio 100 40 60
______________________________________________________________________________
Scan For Softcopy of Notes

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CA Inter | Costing | Marginal Costing
Question 18:

Break even point

______________________________________________________________________________

in Enits intamount
______________________________________________________________________________
in
for
capacity
to
______________________________________________________________________________
In s In
______________________________________________________________________________
for
contribution pin PIV Ratio conbi.at 1 capacity
______________________________________________________________________________

37,500 37,500
______________________________________________________________________________
37,500
20 5 215 2 20 40,000 11 215
______________________________________________________________________________

______________________________________________________________________________
237,500 215 373 59000 237,500 2 6000
2500 units
Question 19: 6.25

calculation of Break even point

______________________________________________________________________________

particulars Amt I
______________________________________________________________________________

price p.cl 12
selling
______________________________________________________________________________
variable cost p u 3
______________________________________________________________________________

contribution P U a b 9
______________________________________________________________________________

P U Ratio Ya 100 751

______________________________________________________________________________
contribution at 1 capacity 80,000units 1 c 7,200
______________________________________________________________________________

Fixed cost for the year II 20,000 4 80,000 9

______________________________________________________________________________

BEP in units
ff 53,333.33333units
______________________________________________________________________________

BEP in amount df
______________________________________________________________________________
axg 26.40.000
Scan For Softcopy of Notes
______________________________________________________________________________
66
BEP in capacity
#CostingbyVR f CA8,000
Vinod
100
Reddy
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CA Inter | Costing | Marginal Costing
Question 20:

______________________________________________________________________________
Basic data
______________________________________________________________________________
i contribution p.it selling price p u vasi.wstp.us
______________________________________________________________________________
20 12 8
______________________________________________________________________________
ii P v Ratio contribution p.ua 100
______________________________________________________________________________
selling price
p.in
______________________________________________________________________________
100 40
______________________________________________________________________________
but
iii contribution at 1 Y.hu
______________________________________________________________________________
capacity Yfamilyinunits
______________________________________________________________________________
8
20,000 units
1
______________________________________________________________________________
1,6001
______________________________________________________________________________
i No of units to be sold for desired profitof 24,000
______________________________________________________________________________
Desired profit Fired wst 24,000 80,00
______________________________________________________________________________
contribution pay 8
______________________________________________________________________________

13,000 units
______________________________________________________________________________

required fordesired of
profit 24,000
______________________________________________________________________________
ii Turnover
______________________________________________________________________________
Desired profit Fined cost 24,000 80,00
______________________________________________________________________________
401
P V Ratio
______________________________________________________________________________
2,600004
______________________________________________________________________________
iii capacity to be used for desired profit of 29,000
______________________________________________________________________________
Desired profit Fined cost 24,000 80,00
______________________________________________________________________________
contribution at 1 capacity 1600
______________________________________________________________________________
65.00
______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

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CA Inter | Costing | Marginal Costing
Question 21:

(Normal capacity = 25000 units)

calculation of BEP sales capacity for desired profit

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

selling price per unit so

______________________________________________________________________________

Variable cost per unit

______________________________________________________________________________
20
______________________________________________________________________________
contribution per unit a b 30
______________________________________________________________________________
60
100
profit volume Ratio ca
______________________________________________________________________________
contribution at 1 capacity 7,500
25000 units
______________________________________________________________________________
1 30
______________________________________________________________________________
30
Fixed cost for
the year 00,000
______________________________________________________________________________
Desired contribution if desired profit 33,00 000
______________________________________________________________________________
f
is 3,00 000 3 00,000
______________________________________________________________________________
For Break even
______________________________________________________________________________
i no_of units to be sold flc 100,000 units
______________________________________________________________________________
ii Turnover required fld 5000,000
______________________________________________________________________________
iii to be used tle 400
capacity
______________________________________________________________________________

For desired profit of 300,000

______________________________________________________________________________
1 10,000 units
i No_of units to be sold 9k
______________________________________________________________________________

ii Turnover required 9 d 5500,000

______________________________________________________________________________

iii capacity to be used 9 e 440

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

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CA Inter | Costing | Marginal Costing
Question 22:

Calculation of Margin of safety units amount in

______________________________________________________________________________

MOs Ratio profit

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

price P U 20
selling
______________________________________________________________________________

variable cost P U 15
______________________________________________________________________________

contribution P U a b 5
______________________________________________________________________________

profit volume ratio ca 100 25

______________________________________________________________________________

Fixed cost for the year 1 50,000

______________________________________________________________________________

BEP in units etc 30,000 units

______________________________________________________________________________

BEP in amount ed OR f
a I 6 00,000
______________________________________________________________________________

Actual sales volume for the year 40,000 units

______________________________________________________________________________

Margin of safety in units h f 10,000 units

______________________________________________________________________________

inamount ixa 200,000

Margin of safety
______________________________________________________________________________

Actual sales value for the year ax h 8,00 000

______________________________________________________________________________

______________________________________________________________________________
Margin of safety
25
Mos Ratio OR
______________________________________________________________________________
I K 100
______________________________________________________________________________
profit jxd 50,0001
______________________________________________________________________________
K xd e
______________________________________________________________________________

______________________________________________________________________________
ORO cxh e
______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR P CA Vinod Reddy

______________________________________________________________________________
MOS sales V Ratio profit
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Formulae at a Glance

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

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______________________________________________________________________________

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CA Inter | Costing | Marginal Costing

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

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Question 23:

______________________________________________________________________________
Fixed cost for the year salesfor the year P u Ratio profit
______________________________________________________________________________
20 00,000 25
50,000
______________________________________________________________________________
I 4 50,000
______________________________________________________________________________
fined wst for the year
Breakeven sales
______________________________________________________________________________
for the
year Plu Ratio
______________________________________________________________________________

450,000 18 00,0004
______________________________________________________________________________
25
______________________________________________________________________________
Profit for the year
of sales
______________________________________________________________________________
safety
Margin P V Ratio
______________________________________________________________________________
5 0
2,09000
______________________________________________________________________________

______________________________________________________________________________
of safety ratio i.e Mos Ratio
Margin
______________________________________________________________________________

Margin of safety sales

______________________________________________________________________________
100
Total sales
______________________________________________________________________________

______________________________________________________________________________
2 00,000
100 10.00
______________________________________________________________________________
20,00 000
Additional Question
______________________________________________________________________________

for the year

profit 20,000 V cost ratio 801
______________________________________________________________________________

Find Mos sales

______________________________________________________________________________
As vari cost ratio 80 we can say that
______________________________________________________________________________
Plu Ratio 20
______________________________________________________________________________

i Mos sales P V Ratio profit

______________________________________________________________________________
2 0 0
ff.fi 22 1 00,000
______________________________________________________________________________
e
______________________________________________________________________________

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

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CA Inter | Costing | Marginal Costing
Question 24:

Break pointfor the year

______________________________________________________________________________
even
2 00,000
______________________________________________________________________________
e
BEP III Etp selling price p.in v.wstp.in
______________________________________________________________________________
inunits
I 2,00 000 2100,000
______________________________________________________________________________
12 12 16.66666666 12 2
______________________________________________________________________________

20,000 units
______________________________________________________________________________

fired wst for the year 200,000

______________________________________________________________________________

gEfmount Plu Ratio E 10 2 12

______________________________________________________________________________

______________________________________________________________________________
2100,000
288 240,0001
0.8333333333
______________________________________________________________________________

No of units to be sold in a year for desired profit

of 400,00
______________________________________________________________________________

Desired profit Fixed cost 909000 200,0

______________________________________________________________________________

contribution per unit 10

______________________________________________________________________________

______________________________________________________________________________
60,000 units
______________________________________________________________________________
when sales volume for the Year 1
00,000 units
______________________________________________________________________________

inunits 1 00,000 units B E P in units

______________________________________________________________________________
Marginof safety units
1,00000 20,000
______________________________________________________________________________

80,000 units
______________________________________________________________________________

Mos Ratio Mos inonits

______________________________________________________________________________
100
Total sales inunits
______________________________________________________________________________

______________________________________________________________________________
19
______________________________________________________________________________
80
______________________________________________________________________________
Scan For Softcopy of Notes

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CA Inter | Costing | Marginal Costing

1) Variable change in Total wst

Particulars Year 1 Year 2
cost p.u.
changein sales cety
a) No. of units sold 20,000 30,000
b) Selling price p.u. 50 50
c) Variable cost p.u. 10 10 2) Variable change in Totalcost 1
cost ratio.
d) Contribution p.u. 40 40
change in sales
e) Total sales ax b 10,00,000 15,00,000
f) Variable cost of 2,00,000 3,00,000
goods sold 3) Contribution change in profit
g) Contribution19 8,00,000 12,00,000 p.u.
change.in
h) Fixed cost 2,00,000 2,00,000
I)Total cost fth 4,00,000 5,00,000
Ching hn
4) P/V Ratio xioo
j) Proﬁt 6,00,000 10,00,000
le ilorcg.nl a

______________________________________________________________________________
Note that these 4
Please
formulae can be used when
______________________________________________________________________________
only
ie Fixed
equal length
we are comparing 2 periods of
______________________________________________________________________________

cost involved in both periods must be same

______________________________________________________________________________

Question 25:

comparing data of Year

1 Year 2
______________________________________________________________________________
100,00
change in profit 1180,000
______________________________________________________________________________
contribution
perky in sales
quantity 3,000
Kgs 2000kg
change
______________________________________________________________________________

80,000 80
______________________________________________________________________________
loook.gs
______________________________________________________________________________
anti per kg 100 4
i profit volume Ratio 100
______________________________________________________________________________
selling pricepesky
______________________________________________________________________________
0 40 0.60
variable cost Ratio 1 Plu Ratio 1
______________________________________________________________________________
i
60
______________________________________________________________________________
V cost perkg 80
ORG 100
100 Scan For Softcopy of Notes 60
______________________________________________________________________________
200
#CostingbyVRsellingpriceperCA
kg Vinod Reddy
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CA Inter | Costing | Marginal Costing
Question 26:

______________________________________________________________________________

data of Jan to June 2018 i.e 6

______________________________________________________________________________
months
comparing
ie 6 months
4
______________________________________________________________________________
to Dec 2018
July
______________________________________________________________________________
volume change
inprofit
Iff 1001
______________________________________________________________________________
change in sales
______________________________________________________________________________
2 00,000 80,000
______________________________________________________________________________
100
24 80,000 20,00 000
______________________________________________________________________________

______________________________________________________________________________
1120,000 25
100
4 80,000
______________________________________________________________________________

using Jan June data

______________________________________________________________________________

sales PIV Ratio profit

______________________________________________________________________________
Fixed cost of
6 months 25 80,000
______________________________________________________________________________
20,00 000
4,20 0001
______________________________________________________________________________

4 20,000 2
i Fixed cost for the
______________________________________________________________________________
year
I 8,40 000
______________________________________________________________________________

Turnover required to make annual profit of 4 00,000

______________________________________________________________________________

Desired profit Fixed cost for the year

______________________________________________________________________________

PIV Ratio
______________________________________________________________________________

______________________________________________________________________________
4100,000 8,401000 49,60 000
______________________________________________________________________________
25
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 27:

Given data in the question is for months 3

______________________________________________________________________________
a months

i e it is not for equal length of time

______________________________________________________________________________
resp
data into equivalent
______________________________________________________________________________
Let's convert Jan march
data so that it will become comparable
______________________________________________________________________________
9 months
April Dec data
______________________________________________________________________________
with
______________________________________________________________________________
particulars Jan March April Dec
______________________________________________________________________________
a months
Finished
______________________________________________________________________________

4,00 000
______________________________________________________________________________
9 months
sales value 3months
______________________________________________________________________________
12,001000 16 00,000
______________________________________________________________________________
20,000 months
profit 9
______________________________________________________________________________
3 months
1 80,000
I 60,000
______________________________________________________________________________

change in profit
______________________________________________________________________________
profit volume ratio in sales
10
change
______________________________________________________________________________

______________________________________________________________________________

E
______________________________________________________________________________

______________________________________________________________________________
100 30
______________________________________________________________________________

Using data of April Dec 2020

______________________________________________________________________________

Fixed cost of a months sales Plv Ratio profit

______________________________________________________________________________

______________________________________________________________________________
E 16100,000 30 E 1 80,000
______________________________________________________________________________
3,00 000
______________________________________________________________________________
i Fixed cost for the year E months 4,09000
39 2 9
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Fired cost for the yea 400,000

i Bep finant
______________________________________________________________________________
P U Ratio 30
For the year
______________________________________________________________________________
1333333.333333
______________________________________________________________________________
of
ii Turnover required for desired profit 950,000
______________________________________________________________________________

8S Pff Elissa 450,000

______________________________________________________________________________
30
400,00

P v Ratio
______________________________________________________________________________

______________________________________________________________________________
28 33,333.3333333
______________________________________________________________________________
OR
______________________________________________________________________________
Fixed cost for
Let Plu Ratio be set
y
3 months
______________________________________________________________________________

per given data

______________________________________________________________________________
AS
______________________________________________________________________________
Jan March 4 00,000
0
20,000
y
______________________________________________________________________________
40002 y 20,000
______________________________________________________________________________
80,000 1
April Dec 16 00,000
3y
______________________________________________________________________________
0
______________________________________________________________________________
1
1600020 3y 80,000
______________________________________________________________________________
60,000 Let's use Eth
120002 39
______________________________________________________________________________
160002 180,000 4000130 y 20,000
______________________________________________________________________________
1
40002 120,000 20,000 20,000
______________________________________________________________________________ y
30 Y 00,000 1
H
______________________________________________________________________________
FC of 3 months 1 00,000
Question 28:
P v Ratio 30
Fc of the year 4,00 000

______________________________________________________________________________

______________________________________________________________________________
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______________________________________________________________________________

data of Jan 2020 Feb

2020
______________________________________________________________________________
comparing
volume change in profit
______________________________________________________________________________
100
Pifft in sales
______________________________________________________________________________
change
______________________________________________________________________________
5,000 1,000 100
______________________________________________________________________________
40,000 20,000
______________________________________________________________________________

E
100 20
______________________________________________________________________________

______________________________________________________________________________
data of Jan 2020
using
______________________________________________________________________________
Fixed cost for sales plu ratio profit
______________________________________________________________________________
the month
20,000 20 1,000
______________________________________________________________________________

3,000
______________________________________________________________________________

for 3000 12 36,000k

______________________________________________________________________________
Fixed cost the year
______________________________________________________________________________

i Break even point for the year

______________________________________________________________________________

Fixed cost for the year

______________________________________________________________________________
P U Ratio 9 362
______________________________________________________________________________

1 80,0004
______________________________________________________________________________

______________________________________________________________________________
ii Sales required for desired annual profit of 85,000
______________________________________________________________________________
Desired profit for the year Fixed cost for the
______________________________________________________________________________ yeary
PIV Ratio
______________________________________________________________________________

85,000 36,000
______________________________________________________________________________
6,050004
20
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 29:

______________________________________________________________________________

Given data in the question is for 1 month 2 months

______________________________________________________________________________
Let's convert Feb march 2018 data into
resp
______________________________________________________________________________

Equivalent 1 month data calculate P V Ratio

______________________________________________________________________________

______________________________________________________________________________
Jan 2018 Feb March 2018
particulars
1 month Equivalent 1 month
______________________________________________________________________________
Sales 50,000 1,60000 2 80,000
______________________________________________________________________________

profit 20,000 290,000 2 45,000

______________________________________________________________________________

i P V Ratio change in profit

______________________________________________________________________________
10
change in sales
______________________________________________________________________________
45,000 20,000
______________________________________________________________________________
100 too
80,000 50,000
______________________________________________________________________________
83
______________________________________________________________________________
Jan 2018 data
using
______________________________________________________________________________

Fixed cost for profit

______________________________________________________________________________
sales p v Ratio
1 month
______________________________________________________________________________
50,000 83 20,000 21,666.66666
______________________________________________________________________________

i Fixed cost for the year 221,666.66666 12 2160,0001

______________________________________________________________________________

______________________________________________________________________________
Break even sales for the year
Fixed cost for the year Plv Ratio
______________________________________________________________________________

2 60,000 83 3333333 3,121000k

______________________________________________________________________________

sales required to make annual profit of 200,000

______________________________________________________________________________

Desired profit for the year Fixed cost for the year
______________________________________________________________________________
PIV Ratio
______________________________________________________________________________
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2 2100,000 22 60,000
52,0004
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Question 30:
Exam question Imp

Calculation of Break even point in units

______________________________________________________________________________

______________________________________________________________________________
Amt
particulars E
______________________________________________________________________________
selling price per unit 25
______________________________________________________________________________
unit
variable cost per
8 00,000 80,000units 10.00
______________________________________________________________________________
Material cost
Labour charges 4 00,000 80,000 units 5.00
______________________________________________________________________________
variable over heads 2,00000 80,000units 2.50
______________________________________________________________________________
Sub total 17.50
______________________________________________________________________________
contribution D u a b 7.50
______________________________________________________________________________
Fixed cost for the period 3 60,000
______________________________________________________________________________
Break even point in units dk 48,000 units
______________________________________________________________________________

______________________________________________________________________________
Calculation of sales required to earn profitof 20 on sales
______________________________________________________________________________
on sales
Let Iae be sales required to earn profit of 20
______________________________________________________________________________
sales required to earn Desired profit Fixed cost
______________________________________________________________________________
desired profit P V Ratio
______________________________________________________________________________
0.202 3 60,000 0.202 360,000
______________________________________________________________________________
7.50 25 0.30
i 0.302 0.202 3 60,000
______________________________________________________________________________
o lose 3 60,000 D 36,00 000
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Extra units to be sold to obtain present profit

after
______________________________________________________________________________

reduction in
______________________________________________________________________________
selling price p.ir
______________________________________________________________________________
particulars Reduction in
selling
______________________________________________________________________________
price p.u.by
20 25
______________________________________________________________________________

Existing selling price P U E 25.00 25.00

______________________________________________________________________________

Revisedselling pricep.us E 20.00 18.75

______________________________________________________________________________
25 20 2 5 25 25 1257
______________________________________________________________________________

variable cost p n Refer w.N.IO 17.50 17 so

______________________________________________________________________________
contribution p.cl b c 2.50 1.25
______________________________________________________________________________

Desired profit E 2,40 000 2 40,000

______________________________________________________________________________

Fixed cost E 3 60,000 3 60,000

______________________________________________________________________________

Desired contribution etf 6

00,000 00,000 6
______________________________________________________________________________
No of units to be sold 9 2 240,000 units80,000 4 units
______________________________________________________________________________

Extra units to be sold to 1 60,000 900,000

______________________________________________________________________________
obtain present profit h 80,000 units units
______________________________________________________________________________

______________________________________________________________________________
down BEP
calculation of selling pricep.u.to bring
to 10,000 units under present conditions
______________________________________________________________________________

the period
______________________________________________________________________________
BEP in units ftp.t.hr
______________________________________________________________________________

3 60,000
______________________________________________________________________________
10,000 17.50
selling price p.cl
______________________________________________________________________________

17.50 3
60,000
______________________________________________________________________________
price p.cl 36
selling 10,000
______________________________________________________________________________
36 17.50
selling price p u
______________________________________________________________________________
53.50
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 31:

______________________________________________________________________________
of sales Total sales Mos ratio
Margin safety
______________________________________________________________________________
2
50,000 60
______________________________________________________________________________
El 50,000
______________________________________________________________________________
sales
i Break even sales Total sales Margin of safety
______________________________________________________________________________
2 50,000 150,000
______________________________________________________________________________
I 1 00,0001
______________________________________________________________________________

of sales PIV Ratio

Net profit Margin safety
______________________________________________________________________________

I 1 50,000 30 45,0001
______________________________________________________________________________

______________________________________________________________________________
B E sales P V Ratio
Fixed cost for the period
I 1,00 000 30 30,000k
______________________________________________________________________________

______________________________________________________________________________
required to earn desired
Sales profit
of 1,05000
______________________________________________________________________________
Desired profit Fixed cost
______________________________________________________________________________
P V Ratio
______________________________________________________________________________
EI
05,000 30,000 4 50,000
______________________________________________________________________________
30
______________________________________________________________________________

Mos Ratio when sales are 400,000 for the

______________________________________________________________________________ period
______________________________________________________________________________

Total sales B E sales

______________________________________________________________________________
10
Total sales
______________________________________________________________________________

______________________________________________________________________________
5400,000 1100,000
10
If
______________________________________________________________________________
4 00,000
10

______________________________________________________________________________
75000
______________________________________________________________________________
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Question 32:

Total sales Break even sales

______________________________________________________________________________
no
Mos Ratio
Total sales
______________________________________________________________________________

Total sales 6,00 000

______________________________________________________________________________
4 Total sales
______________________________________________________________________________

Total sales Total sales 6 00,000

______________________________________________________________________________
0.40
EG 00,000 Total sales 1 0.40 Total sales
______________________________________________________________________________

EG 00,000 Total sales l 0.40

______________________________________________________________________________

EG 00,000 Total sales 0.60

______________________________________________________________________________
Total sales 10 00,0004
______________________________________________________________________________

for
the period Break even sales Plv Ratio
______________________________________________________________________________
Fixed cost
EG 00,000 20 1 20,0001
______________________________________________________________________________

______________________________________________________________________________
Sales required to earn of I 2 50,000 for the year
profit
______________________________________________________________________________
Desired profit Fixed cost
______________________________________________________________________________
PH Ratio
______________________________________________________________________________
2 50,000 1,201000 18 50,0001
______________________________________________________________________________
0.20
______________________________________________________________________________

Mos Ratio when Total sales are

______________________________________________________________________________
1500,000
______________________________________________________________________________
Total sales B E Sales 100
______________________________________________________________________________
Total sales
______________________________________________________________________________

______________________________________________________________________________
15,001000 6,001000 100
15 00,000
______________________________________________________________________________

______________________________________________________________________________
100 60
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Additional Question
______________________________________________________________________________
sales for the year I 80 00,000
______________________________________________________________________________
MOS Ratio 30
______________________________________________________________________________
P V Ratio 20
Income tax rate
______________________________________________________________________________
35
Find profit after tax to sales ratio
______________________________________________________________________________

______________________________________________________________________________

profit after tax sales Mos Ratio Plv Ratio

1
______________________________________________________________________________
0.35

20 0.65
______________________________________________________________________________
000 30
80,00
3 12,000
______________________________________________________________________________

profit after tax 3,121000

______________________________________________________________________________
3.90
100
to sales Ratio
80,00000
Question 33:

Particulars Year 1 Year 2

Particulars ₹15,00,000 ₹8,00,000

Proﬁt / (Loss) ₹1,00,000 (₹1,80,000)

Calculate 1) P/V Ratio

2) Fixed cost for the year
3) Turnover required to earn annual proﬁt of ₹3,80,000

comparing data of Year I Year 2

______________________________________________________________________________

change in profit
______________________________________________________________________________
volume 1
in sales
______________________________________________________________________________
change
______________________________________________________________________________
0001,00 1,80 000
______________________________________________________________________________
15,00 000 8 00,000
______________________________________________________________________________

E no aoi
______________________________________________________________________________

______________________________________________________________________________
data of year 2
using
______________________________________________________________________________
sales Ply Ratio profit
Fixed cost for the year
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cost for the Year 800,000 40 1,80 000

______________________________________________________________________________
Fixed
______________________________________________________________________________
3 1 80,000
20,000
500,000k
______________________________________________________________________________

______________________________________________________________________________
Turnover required for annual profit of 3 80,000
______________________________________________________________________________
Desired profit Fixed cost
______________________________________________________________________________
P v Ratio
______________________________________________________________________________

500,000 2200,0001
______________________________________________________________________________
E3
80,0004
______________________________________________________________________________

______________________________________________________________________________

Question 34:

Selling price per unit = ₹25

Variable cost per unit = ₹15
Fixed cost for the period = ₹80,00,000
(including depreciation of ₹20,00,000)
Calculate a) Normal BEP
b) Cash BEP

______________________________________________________________________________

Normal BEP in units

______________________________________________________________________________

period
______________________________________________________________________________
total Fixed cost for the
contribution per unit
______________________________________________________________________________If
______________________________________________________________________________
80,00 000 units
8,00 000
______________________________________________________________________________
10

contribution generated 8 00,000 units is able to

______________________________________________________________________________
by
______________________________________________________________________________
cover Entire Fixed cost
______________________________________________________________________________
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Cash BEP
______________________________________________________________________________

cash Fixed cost

______________________________________________________________________________
contribution p.cl
______________________________________________________________________________

______________________________________________________________________________
fixed cost
Total Non cash fixed cost
______________________________________________________________________________
contribution p.ci
______________________________________________________________________________
80,00 000 20100,000 60,00 000
______________________________________________________________________________
10 10
______________________________________________________________________________
6,00 000 Units
______________________________________________________________________________

contribution 600,000 units is able to

generated by
______________________________________________________________________________

cover entire cash Fixed cost but non cash fixed

______________________________________________________________________________

cost is to be recovered
______________________________________________________________________________
yet company's
cash profit
______________________________________________________________________________
Loss is but there is Book Loss of
OR zero
000
20,00 at 6,00 000 units
______________________________________________________________________________
600,000 hits
______________________________________________________________________________
8100,00

units
______________________________________________________________________________

No of units sold
______________________________________________________________________________

cash Loss as well as Book Loss

______________________________________________________________________________
cash profit Loss Zero Book Loss of Non rash
______________________________________________________________________________
Fixed cost
______________________________________________________________________________
Book
cash profit is there but There are Losses
as part non cash Fixed cost is not recovered
of
______________________________________________________________________________
Book profit Loss is zero there is cash profit
______________________________________________________________________________
i e Entire Fixed cost cash Non cash has been
recovered
______________________________________________________________________________
Book profits
Question 35 & 36:

Q35.

Q36.

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350
______________________________________________________________________________

Normal Break even point for the year

______________________________________________________________________________

______________________________________________________________________________
s
if p e on
v wston
______________________________________________________________________________

260,000 2 10 6,000 units

______________________________________________________________________________

______________________________________________________________________________
Cash for the
BEP year
fired cost Non cash fixedos
______________________________________________________________________________
cash fixed cost
contributionp.ae contribution pu
______________________________________________________________________________

I 60,00 101000 units

______________________________________________________________________________
22 5,000
______________________________________________________________________________
Also Normal BEP in amt 6000 units 12 72,000
______________________________________________________________________________
cash BE p inant 5000 units 12 60,000
______________________________________________________________________________

______________________________________________________________________________

Normal Break even point for theyear

______________________________________________________________________________

______________________________________________________________________________
Total fixed cost for the year
______________________________________________________________________________
contribution p.cn
______________________________________________________________________________
10,00 000
______________________________________________________________________________
V wstp.ir 18 16
sellingprice p n
______________________________________________________________________________

1000,000 2 2 500,000 units

______________________________________________________________________________

Cash BEP for the

______________________________________________________________________________
year
cash fixed total fired cost Non cash fixed
______________________________________________________________________________
contribution p u
cost
contribution p
______________________________________________________________________________

10100,000 80,000 9,201000 4 60,000

______________________________________________________________________________ Uni
2 2
______________________________________________________________________________
Also Normal BEP in amt 500,000Scanunits
For Softcopy of 18
Notes 90,0000
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CA Vinod Reddy
______________________________________________________________________________
4,00 000Units 18 8280,00
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Question 37:

Comparing data of Year

Year 1 2
______________________________________________________________________________

______________________________________________________________________________
volume change in profit 100
ftp.fft
______________________________________________________________________________
change in sales
______________________________________________________________________________

3 00,000
______________________________________________________________________________
700,000
______________________________________________________________________________
57 00,000 32,001000
______________________________________________________________________________
40
100
______________________________________________________________________________

using data of Year 1

______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the year sales Ratio
Plu profit
______________________________________________________________________________
E 32100,000 40 3,00 000
______________________________________________________________________________
12 80,000 3,00 000 15 80,0004
______________________________________________________________________________

Sales required profit 12,00000 for the year

______________________________________________________________________________
to earn of
______________________________________________________________________________
for the
Desired profit Fixed cost year
______________________________________________________________________________
PV Ratio
______________________________________________________________________________
12100,000 1589000 6950,000k
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 38:

______________________________________________________________________________

Sales Revenue required to achieve quarterly

______________________________________________________________________________

profit of 70,000
______________________________________________________________________________

Desired profit for the Quarter Fixed cost for the

______________________________________________________________________________
Quarter
______________________________________________________________________________
PH Ratio
______________________________________________________________________________
I 70,000 I 2 80,000
______________________________________________________________________________
28
______________________________________________________________________________

1250,0001
______________________________________________________________________________

______________________________________________________________________________

Question 39:

______________________________________________________________________________

Break even point in units for the Year

______________________________________________________________________________

Fixed cost for the Year

______________________________________________________________________________
contribution per unit
______________________________________________________________________________

10,000 units
E o
______________________________________________________________________________

______________________________________________________________________________
Break even point in amount
______________________________________________________________________________

BE p in units selling price p.cn

______________________________________________________________________________

10,000 units
2S
______________________________________________________________________________
2 50,0004
______________________________________________________________________________
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______________________________________________________________________________

Break even chart or profit volume chart

______________________________________________________________________________

Y axis sales Line

______________________________________________________________________________
5
line
cost
______________________________________________________________________________
Total
______________________________________________________________________________
Amount cost
variable
______________________________________________________________________________
E
you
______________________________________________________________________________

BEP
______________________________________________________________________________

Ed's total
______________________________________________________________________________
fixed
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
0 Ép in units x
______________________________________________________________________________
afer's
10,000units
______________________________________________________________________________
No of units produced sold
in
______________________________________________________________________________

contribution Zone
______________________________________________________________________________
ROT
RMS profit zone
______________________________________________________________________________

Loss zone
YMO
______________________________________________________________________________

BEP in amount
______________________________________________________________________________
op
BEP in units
______________________________________________________________________________
Q
of created by intersection of sales Line
______________________________________________________________________________
Angle Angle
Incidence Total cost Line
______________________________________________________________________________

of incidence represents
______________________________________________________________________________
Higher angle
well as higher risk
______________________________________________________________________________
higher profit margin
as
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 40:
concept of shut down
Fixed cost for the year = ₹20,00,000 point
Selling price p.u. = ₹50
Variable cost p.u. = ₹40
Fixed cost for the year if we shut down the plant = ₹5,00,000
Additional expenditure to be incurred in case of shut down = ₹1,00,000
Calculate the shut down point &
Interpret the result. If expected demand is 1,50,000 units for coming year, whether company
should shut down?

pls Note that

______________________________________________________________________________
shut down means Temporary
of business plant
______________________________________________________________________________
closure
______________________________________________________________________________

calculation of shut down point

______________________________________________________________________________

______________________________________________________________________________
cost
Avoidable Fixed
______________________________________________________________________________
contribution P y
______________________________________________________________________________

Ine It
______________________________________________________________________________
in Yant
______________________________________________________________________________
price p.cl
selling vaoi.wstp.us
______________________________________________________________________________

______________________________________________________________________________
It
20,001000 500,000T
50 40
00,00J
______________________________________________________________________________

______________________________________________________________________________
20,001000 6,00100 14,00 000
______________________________________________________________________________
10 10
______________________________________________________________________________
1
40,000 units
______________________________________________________________________________

Interpretation of shut down point

______________________________________________________________________________

continue the shut down

______________________________________________________________________________
particulars
plant the
______________________________________________________________________________ plant
contribution 14,001000
______________________________________________________________________________
0
140,000 210
______________________________________________________________________________
Less Fixed Wst 20 00,000 6,00 000
______________________________________________________________________________
000
profit Loss 16,00 Scan For Softcopy of Notes
690,000
______________________________________________________________________________
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No of units expected to sold Decision
______________________________________________________________________________

in coming years a
______________________________________________________________________________

continue the plant

______________________________________________________________________________
de 1 40,000
shut down the
______________________________________________________________________________
000
1,40 plant
______________________________________________________________________________

______________________________________________________________________________

From above Table it is clear that company

______________________________________________________________________________

should continue the plant if expected demand

______________________________________________________________________________

units for the year

______________________________________________________________________________
is 1,50 000
______________________________________________________________________________

______________________________________________________________________________

Question 41 & 42:

Q41.

Q42.

calculation of shut down point

______________________________________________________________________________

______________________________________________________________________________
Fixed cost
Avoidable
______________________________________________________________________________
contribution p u
______________________________________________________________________________
Fixed cost for the year
8
______________________________________________________________________________
petty'The
ifeng.ngh.fi sYttsnifaint
______________________________________________________________________________

sellingprice p.cl vaoi.wstp.us

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3100,000 22,00 000 720,000

81000
______________________________________________________________________________
20 15
______________________________________________________________________________
16,000 units
______________________________________________________________________________
calculation of shut down point for the Quarter
______________________________________________________________________________
Avoidable Fixed cost
______________________________________________________________________________
contribution p u
______________________________________________________________________________

Fixed cost for the Quarter

______________________________________________________________________________
Eh
fifty e
ifeng.nghi.fi ittsntfdiht
______________________________________________________________________________

contribution per unit

______________________________________________________________________________

______________________________________________________________________________
5000
60,000 40,000
800
______________________________________________________________________________
1,500 units
I 10
means If we are expecting demand of more than 1500
It______________________________________________________________________________
units for the quarter we should continue the plant whereas
______________________________________________________________________________
units
if expected demand for the quarter is less than 1500
It is recommended to shut down the plant
Question 43:

Semi - automatic
Particulars automatic machine
machine

Variable cost p.u. ₹10 ₹4

Fixed cost p.u. ₹10,00,000 ₹34,00,000
for the period Year
1) Calculate cost BEP
2) For coming year company is planning to produce & sell
5,00,000 units, suggest which machine should be installed

______________________________________________________________________________
Let no_of units produced in the year bei.ae
______________________________________________________________________________
for cost Break even
______________________________________________________________________________
Total cost of producing Total cost
______________________________________________________________________________
of producing
units by installing re units by installing
______________________________________________________________________________
semi automatic machine Automatic machine
______________________________________________________________________________
2 10 10
00,000 sexy t 34,00 000
______________________________________________________________________________
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102 42 34 00,000 10,00900

______________________________________________________________________________

34 00,000 10,001000
______________________________________________________________________________
a 10 4
______________________________________________________________________________
34100,000 10,09000
______________________________________________________________________________
10 4
fixed cost under
______________________________________________________________________________
cost BEP fifth
______________________________________________________________________________
iff in vari cost p u
______________________________________________________________________________

Cost BEP a 400,000 units

______________________________________________________________________________

Interpretation of cost BEP

______________________________________________________________________________

______________________________________________________________________________
No of units to be produced
Decision
______________________________________________________________________________
in a a
year
producing on semi automatic
______________________________________________________________________________
units
a 4 00,000 machine will result in
______________________________________________________________________________
Lower Total cost
______________________________________________________________________________

a 4 units
00,000 producing an Automatic
______________________________________________________________________________

machine will result in

______________________________________________________________________________
Lower Total cost
______________________________________________________________________________
Total cost under both
______________________________________________________________________________
2 4 00,000 alternatives is same
______________________________________________________________________________

______________________________________________________________________________
Less than wst BEP option having Lower fixed cost
______________________________________________________________________________
inspite of v wstp.us
higher
______________________________________________________________________________

From table
above It is clear that if
______________________________________________________________________________

______________________________________________________________________________
is planning to produce sell 500,000 units
company
______________________________________________________________________________
in ayear Installation of Automatic machine
______________________________________________________________________________
is recommended
______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 44:

cost BEP Diff in Total Fixed cost under

______________________________________________________________________________
iftfnnati.fi cost per page
______________________________________________________________________________

______________________________________________________________________________
10,001000 20,000
0.40 0.20
______________________________________________________________________________

4900,000 pages
______________________________________________________________________________

Interpretation of cost BEP

______________________________________________________________________________

No_of pages to be painted for the year se Decision

______________________________________________________________________________
re 49,00 000 pages outside painting
______________________________________________________________________________

se 49 00,000 pages own printing

______________________________________________________________________________
2 49 00,000 Total cost under both
alt is same
Question 45:

calculation of cost BEP

______________________________________________________________________________

______________________________________________________________________________
cost BEP Diff in Total Fixed cost under
______________________________________________________________________________
it T.E.wstrer.am
______________________________________________________________________________

______________________________________________________________________________
2100,000 1
300,000
12 10 2
______________________________________________________________________________

______________________________________________________________________________
Kms
50,000
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Interpretation of cost BEP

______________________________________________________________________________
No_of Rms to be traveld a year inse Decision
______________________________________________________________________________
se 50,000 Kms petrol car
______________________________________________________________________________
se 50,000 terms Diesel car
______________________________________________________________________________
cost under both
2 50,000kms
alternatives
______________________________________________________________________________
e
______________________________________________________________________________
Question
______________________________________________________________________________
Alternative 2
Alternative
1
______________________________________________________________________________
Vari Wst p 4 Its 20
______________________________________________________________________________
Fixed cost p 9 I 500,000 800,000
______________________________________________________________________________

______________________________________________________________________________

Find Wst BEP

______________________________________________________________________________
There is BEP
NO cost Totalcost under alternative I
______________________________________________________________________________
will be lesser than total cost under alternative 2
always
Question 46:
question on concept of key Factor misspeak e
Products
Particulars
A B C D E

a) Selling price p.u. 25 30 60 90 100

b) Variable cost p.u. 20 5 10 80 75
c) Labour hrs p.u. 1 10 40 0.50 2
d) Maximum demand 10,000 15,000 2,000 20,000 5,000
(units)

Find maximum possible contribution for the period

If labour hrs are restricted to 60,000 hrs.

______________________________________________________________________________
If we want to satisfy maximum demand of
______________________________________________________________________________
all
5 products then there is requirement
of 2,60 000
______________________________________________________________________________
labour hrs whereas we have limited 60,000 labour
______________________________________________________________________________
there is scarcity of
has available It means
______________________________________________________________________________
resource
to take decisions optimum productmise
related
______________________________________________________________________________
need
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Statement showing calculation of contribution per Labour

______________________________________________________________________________

Factor
hour key priority Ranking
______________________________________________________________________________

______________________________________________________________________________

particulars products
______________________________________________________________________________
A B C D E
______________________________________________________________________________

30 100
sellingprice D 4 E 25 60 90
______________________________________________________________________________

Variable wstp.U.IE 20 5 10 80 75
______________________________________________________________________________

contribution p.u.IE 25 50 10 25
______________________________________________________________________________
5
a b
______________________________________________________________________________

Labour hrs pin I has to has 40 has 0 so has 2 hrs

______________________________________________________________________________

contribution per 5.00 2.50 1.25 20.00 12.50

______________________________________________________________________________
Labour hr Vd
______________________________________________________________________________

priority Ranking 3ʳᵈ 4th 5th 1st

______________________________________________________________________________ and
______________________________________________________________________________

______________________________________________________________________________

statement allocation of key resource

______________________________________________________________________________
showing
______________________________________________________________________________
products Labour has Total Labour has Balance Labour
required hours
______________________________________________________________________________
p.ie
______________________________________________________________________________
resource
Key 60,000
available
______________________________________________________________________________
i product D o Sonos 59000
go.def8iitshfso.so
______________________________________________________________________________

______________________________________________________________________________
ii product E 2.00 hrs 50 8891 2 has 40,000
______________________________________________________________________________
iii product A 1 00 no 39000
go.fi inisxina
______________________________________________________________________________

______________________________________________________________________________
iv product B 10.00 has 0
30,000
Bal reso used 3000 units 10h25
______________________________________________________________________________

optimum product mile 10000 units of A 3000 units of B

______________________________________________________________________________
120000 units of D 5000 units of E
______________________________________________________________________________
Scan
3000For Softcopy of Notes
Maximum possible 10,000 25 225 20,000 710
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contribution CA Vinod Reddy
______________________________________________________________________________
5000 25
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CA Inter | Costing | Marginal Costing
Question 47:

In this question there is limited supply of labour

______________________________________________________________________________

that's we can't the entire

hours why satisfy
______________________________________________________________________________

demand of all products we need to take

______________________________________________________________________________

optimum product mise decision in order to maximize the

______________________________________________________________________________

Maximising the contribution means maximising

profit
______________________________________________________________________________

profit as fixed cost is irrelevant for

decision making
______________________________________________________________________________

Labour hrs is the factor Limited factor scarce factor

key
______________________________________________________________________________

Statement calculation of contribution per labour Rankin

______________________________________________________________________________
showing priority
______________________________________________________________________________
particulars products
______________________________________________________________________________
A B C D
______________________________________________________________________________

selling price per unit E 20 18 30 44

______________________________________________________________________________

variable cost per unit E 17 10 10 30

______________________________________________________________________________

contribution per unit a b 3.00 8.00 20.00 14 00

______________________________________________________________________________
E
______________________________________________________________________________

Labour has p.cn 2 has to has shos 2 hrs

______________________________________________________________________________

______________________________________________________________________________
contribution per labour 1.50 0.80 4 00 7.00
______________________________________________________________________________
hour a E
______________________________________________________________________________

priority ranking 3ʳᵈ 4th and 1st

______________________________________________________________________________

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allocation of resource
Statement showing key
______________________________________________________________________________

______________________________________________________________________________

particulars No_of units to be Labourhos Total

______________________________________________________________________________
Balance
produced Labour Labour
products p.cn
______________________________________________________________________________

FEired
______________________________________________________________________________
has
resource
______________________________________________________________________________
Key 2 00,000
available
______________________________________________________________________________

Resourceused
______________________________________________________________________________

for
______________________________________________________________________________

product D 10,000 units 2hr5 20,000 has 180,000has

______________________________________________________________________________
product C 15,000 units 5hr5 75,000 has 1,05000hrs
______________________________________________________________________________
product A 20,000 units 2h25 40,000has 65,000has
______________________________________________________________________________
product B 6,500 units to has 65,000 has 0
Bal Resourceused 65,000425 10hospin
______________________________________________________________________________

______________________________________________________________________________
Statement showing optimum contribution for the year
______________________________________________________________________________

product No_of units be contribution

to Total
______________________________________________________________________________
sold p.u.IE contribution
E
______________________________________________________________________________

______________________________________________________________________________
10,000 14 1,40 000
______________________________________________________________________________
C 15,000 20 300,000
______________________________________________________________________________

A 20,000 3 60,000
______________________________________________________________________________

______________________________________________________________________________
B 6,500 8 52,000
______________________________________________________________________________
Maximum possible I 552,0004
for
______________________________________________________________________________
contribution the
year
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 48:

Key Factor
______________________________________________________________________________

statement showing calculation of contribution per kg

______________________________________________________________________________

of raw material consumed priority ranking

______________________________________________________________________________

particulars products
______________________________________________________________________________

A B C D E
______________________________________________________________________________

so 75 25 38 29
pricep 4 E
______________________________________________________________________________
Selling
Variable cost Pu E 30 20 IS 20 19
______________________________________________________________________________

contribution 20 55 10 18 10
______________________________________________________________________________
p.u.CI
______________________________________________________________________________
a b
0.25
______________________________________________________________________________
Direct material
required p a of 2kg5 a
kgs a legs 1kg keys
______________________________________________________________________________
output Kgs
______________________________________________________________________________
contribution per 10.00 27.50 2 so 18.00 40.00
kg
______________________________________________________________________________
a
______________________________________________________________________________

4th 2nd 5th 3rd 1st

priority ranking
______________________________________________________________________________

______________________________________________________________________________

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CA Inter | Costing | Marginal Costing

allocation of resource
statement showing key
______________________________________________________________________________

______________________________________________________________________________
No of units to be Material Total Balanie
particulars
______________________________________________________________________________
required Material
products produced retired Material
fit
______________________________________________________________________________
legs Kgs
______________________________________________________________________________

Key resource
______________________________________________________________________________
35,000kg
available
______________________________________________________________________________

Resource used
______________________________________________________________________________
for
______________________________________________________________________________
product E 10,000 units 0.25
legs 2,500Kgs 32,500Kgs
______________________________________________________________________________
product B 5,000 units 2
Kgs 10,00019s 22,500Kgs
______________________________________________________________________________
product D 2,000 units I
kg 2,000kg 20,500Kgs
______________________________________________________________________________
product A 2,000 units 2
4,00095 16,500keys
Kgs
______________________________________________________________________________
product c 4,125 units 4
legs 16
sookgs
0
______________________________________________________________________________
Balance Reso used 16,500kgs 4kgs
______________________________________________________________________________
Statement showing calculation optimum profit
______________________________________________________________________________
for the period
______________________________________________________________________________
particulars Amt E Amt E
______________________________________________________________________________

______________________________________________________________________________
contribution from 4 92,250
______________________________________________________________________________
product A 2000 720 40,000
______________________________________________________________________________
2 75,000
B 15000 55
C
______________________________________________________________________________
4125 210 41,250
D 2000 2 18 36,000
______________________________________________________________________________
E 10,000 10 1 00,000
______________________________________________________________________________
Fixed cost for the
______________________________________________________________________________
15,000
period
______________________________________________________________________________

optimum profit a b 4,77250

______________________________________________________________________________

______________________________________________________________________________
Fixed cost is Scan Forfor
irrelevant decision making
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Question 49:

______________________________________________________________________________

Statement calculation of contribution per labour priorityRanking

______________________________________________________________________________
showing
______________________________________________________________________________
particulars products
______________________________________________________________________________
A B C
______________________________________________________________________________
price p.cl E 50 55 40
selling
______________________________________________________________________________
Direct material cost p 4 10 12 18
______________________________________________________________________________
of output E
5
______________________________________________________________________________
IS
Direct labour cost pin 10
of output E
______________________________________________________________________________

Directexpenses p.u.IE 3 5 11
______________________________________________________________________________

3 8
sellingexpenses p.u.IE
2
______________________________________________________________________________

______________________________________________________________________________
Total variable cost P U 25 35 42
biotite E
______________________________________________________________________________

contribution p.u.la f 25 20 2
______________________________________________________________________________
E
______________________________________________________________________________

Labour hours p n 2 has 3 has 1 hr

______________________________________________________________________________
0 5
______________________________________________________________________________

contribution per labour 12.50 6 66666 2

______________________________________________________________________________

hour 9 4
______________________________________________________________________________

1st 2nd
______________________________________________________________________________
priority Ranking
Scan For Softcopy of Notes
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Statement showing allocation of key resource

______________________________________________________________________________

______________________________________________________________________________
No of units to Lab has Total Balance
particulars
______________________________________________________________________________
Labour
be produced PU Labour
______________________________________________________________________________
has hrs
______________________________________________________________________________

resource
______________________________________________________________________________
key 800
available
______________________________________________________________________________

Resource
______________________________________________________________________________
used for
______________________________________________________________________________
product A 400 units 2 has 800 has
______________________________________________________________________________
0

Balance Resource
______________________________________________________________________________
used 80043 2has
______________________________________________________________________________

______________________________________________________________________________

Calculation of optimum profit for the period

______________________________________________________________________________

______________________________________________________________________________
400 units of product A 25 Fixed cost
______________________________________________________________________________

40,000
______________________________________________________________________________
10,000
of 30,000
______________________________________________________________________________
LOSS
______________________________________________________________________________
General steps to solve questions on key Factor
______________________________________________________________________________

calculate contribution per unit

______________________________________________________________________________

callulate contribution per key factor

______________________________________________________________________________

centriper lab hr centriper machine hr

______________________________________________________________________________
ex
anti per of material
kg
______________________________________________________________________________

on the basis of above

______________________________________________________________________________
priority ranking
allocation of resource
______________________________________________________________________________
statement
prepare showing key
______________________________________________________________________________
Find optimum product mise corresponding
optimum profit or contribution
______________________________________________________________________________
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Concept of composite BEP or Overall BEP
______________________________________________________________________________
Question So IMP
______________________________________________________________________________
particulars products
______________________________________________________________________________
A B C D
______________________________________________________________________________

selling price p n 25 50 80 80
______________________________________________________________________________
No_of units sold 2000 3000 4000 6000
______________________________________________________________________________
P Ratio 40 20 10 60
______________________________________________________________________________
Fixed cost for
______________________________________________________________________________
the period 74,000
______________________________________________________________________________

______________________________________________________________________________
Find overall BEP i e composite BEP for the
company
______________________________________________________________________________

______________________________________________________________________________
Statement overall BEP i e composite BEP
showing calculation of
______________________________________________________________________________

______________________________________________________________________________
particulars products Total
______________________________________________________________________________
A B C D
______________________________________________________________________________
25 SO 80 80
______________________________________________________________________________
prisep.ir
selling
E
______________________________________________________________________________
P V Ratio 401 101
20 60
______________________________________________________________________________

contribution perunit 10 10 8 48
______________________________________________________________________________
axb E
______________________________________________________________________________
No_of units sold 2,000 3,000 4,000 6,000
______________________________________________________________________________

Total contribution 20,000 30,000 32,000 288,000 370,000

______________________________________________________________________________
ex d E
______________________________________________________________________________
Total sales axd 50,000 1 50,000 320,000 480,000 10,00 000
______________________________________________________________________________
E OR Clb
overall P V Total wntoi 3170100
______________________________________________________________________________
Ratio you sales 10,00000 iÉen dt smise Ratio
______________________________________________________________________________
Overall Total Fixed cost
#CostingbyVR f Reddy
CA Vinod 2400,000
______________________________________________________________________________
BEP overall pyrratio
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CA Inter | Costing | Marginal Costing

This BEP is applicable

______________________________________________________________________________
when sales are in the ratio
only
______________________________________________________________________________
of 5 15 32 48
______________________________________________________________________________

cross check
______________________________________________________________________________

Let's divide 200,000 in the ratio of 5 15 32 48

______________________________________________________________________________

______________________________________________________________________________
sales E contribution
products if why Pluratio
______________________________________________________________________________
A 2100,000 1 0 10,000 400 10 40 4,000
______________________________________________________________________________

______________________________________________________________________________
B 2 00,000 1 30,000 600 10 20 6,000
______________________________________________________________________________
0
______________________________________________________________________________

c 2,001000 564,000 800 8 10 6,400

______________________________________________________________________________

______________________________________________________________________________
60 57,600
______________________________________________________________________________
1200 48
1 2,09000 4 96,000
______________________________________________________________________________

Total 2,001000 74,000

______________________________________________________________________________

______________________________________________________________________________
cost
Less Fixed 179,000
______________________________________________________________________________
profit zero
______________________________________________________________________________

fromall products
______________________________________________________________________________
overall Plu Ratio a'guntribution
Ven sales mise ratio
10
______________________________________________________________________________
Total sales
______________________________________________________________________________

overall BEP Total fixed cost

______________________________________________________________________________

OR overall P V Ratio
______________________________________________________________________________

composite BEP
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

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All Formulae on Marginal Costing at one place

(Please subscribe to “CA Vinod Reddy” Youtube Channel)

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

______________________________________________________________________________

______________________________________________________________________________
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Question 51:

Let contribution p.ir of product Fae

______________________________________________________________________________

contribution p.in of product Y I a

______________________________________________________________________________
i fxx
F x 0.202
______________________________________________________________________________
Fo 802
______________________________________________________________________________
Fixed cost of product F
______________________________________________________________________________
Fixed cost of product Y Fz 1 50,000 F
______________________________________________________________________________
that of product is 1800 units
It is given BEP
______________________________________________________________________________
Fired wst of product
B Ep of product
______________________________________________________________________________
wnbi.p.es of product
______________________________________________________________________________

1,800 units
______________________________________________________________________________

______________________________________________________________________________
F 18002

It is also given 3000 units is indifference

______________________________________________________________________________
that point
______________________________________________________________________________
units profit
from 3000
units
Pff 1173000
i
of product Y
______________________________________________________________________________

______________________________________________________________________________
3000 2 F 3000 0.802 Fz
______________________________________________________________________________
30002 F 24002 Fz
______________________________________________________________________________
30002 24002 F Fz using
______________________________________________________________________________
6002 18002 1150,000 Fi Eths 420
______________________________________________________________________________
6002 180021,50 000 F
______________________________________________________________________________
6002 18002 1 50,000 18002
______________________________________________________________________________
1
50,000 30002
______________________________________________________________________________
a 50
______________________________________________________________________________
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F 18002 1800 50 90,000

______________________________________________________________________________

Fz 1,50000 F 1 50,000 90,000 60,000

______________________________________________________________________________

i Fixed cost of product F 90,000

______________________________________________________________________________
Fixed cost of product Y E 60,000
______________________________________________________________________________
whki P U of product IN 50
______________________________________________________________________________
whbi p u of product Y 0.802 0 80 50 40
______________________________________________________________________________

Question 52:

dataof year 1 Year 2

______________________________________________________________________________
Comparing
______________________________________________________________________________

volume Ratio change in profit 10

profit
______________________________________________________________________________
in sales
change
______________________________________________________________________________
I 10 4 lakhs 6 lakhs
100
______________________________________________________________________________
100
175 160 lakhs 1S lakhs
______________________________________________________________________________
40 variable cost Ratio
______________________________________________________________________________
60

data of year 1
using
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the year salesx P V Ratio profit
______________________________________________________________________________
E 160 lakhs 40 E4 lakhs
______________________________________________________________________________
64 lakhs 4 lakhs
______________________________________________________________________________
EGO lakhs
______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

profitability statement for the year if sales

______________________________________________________________________________
are 250 lakhs
______________________________________________________________________________

______________________________________________________________________________
Amt in lakhs
particulars E
______________________________________________________________________________
sales for the year 250
______________________________________________________________________________
variable cost of goods 150
______________________________________________________________________________
sold 9 601
______________________________________________________________________________
contribution for the 100
______________________________________________________________________________

Year a b
______________________________________________________________________________

Fixed cost for the year 60

______________________________________________________________________________

profit for the year c d 40

______________________________________________________________________________

Break even pointfor the year

______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the Year EGO lakhs
______________________________________________________________________________
P V Ratio 40
______________________________________________________________________________

I so lakhs
______________________________________________________________________________

______________________________________________________________________________

Question 53:

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Analysis of cost
______________________________________________________________________________

______________________________________________________________________________
Material cost It is variable cost
______________________________________________________________________________

f
______________________________________________________________________________
materialoston
______________________________________________________________________________

10
______________________________________________________________________________

______________________________________________________________________________
Labour cost It is a variable cost
______________________________________________________________________________

Direct labour cost ra

______________________________________________________________________________
i
______________________________________________________________________________
E3 P U
______________________________________________________________________________

It is a semi variable cost

______________________________________________________________________________
overheads
Factory
______________________________________________________________________________
Let's it Level of activity method
segregate by
______________________________________________________________________________

data of units
______________________________________________________________________________
14,000
comparing 10,000
______________________________________________________________________________

variable in cost
OH change
______________________________________________________________________________
Factory
cost pin change in quantity
______________________________________________________________________________

______________________________________________________________________________
60,000 50,000 2.50
14,000 10,000 units
______________________________________________________________________________
units
Using data of 10,000
______________________________________________________________________________

Fixed over heads Total Factory 0H variable FactoryOH

______________________________________________________________________________
Factory
10,000 units 2.50
______________________________________________________________________________
I 50,000
25,000k
______________________________________________________________________________

______________________________________________________________________________
production is 10,000 units
At 50 capacity
______________________________________________________________________________

It means at Full installed capacitycompany can

______________________________________________________________________________

produce 20,000 units

______________________________________________________________________________
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statement showing Factory cost for 20,000 units

______________________________________________________________________________

______________________________________________________________________________
particulars Amt E E Amt
______________________________________________________________________________

Direct materials 10 P U 2 00,000

______________________________________________________________________________

______________________________________________________________________________
Direct Labour I 3 Py 60,000
______________________________________________________________________________
PRIME COST atb 260,000
______________________________________________________________________________

Factory overheads 75,000

______________________________________________________________________________

Fixed
______________________________________________________________________________
25,000
Variable 20,000 units
______________________________________________________________________________
2.50 50,000
______________________________________________________________________________
cost for
20,000 units 3,350001
Factory
______________________________________________________________________________
Ctd
______________________________________________________________________________

______________________________________________________________________________

Question 54:

cost variable cost

Marginal
III variable

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Statementshowing calculation of Marginal cost

p.us
______________________________________________________________________________

______________________________________________________________________________
contribution p.cl
______________________________________________________________________________
particulars product product Y
______________________________________________________________________________
Direct material cost P.u.IE 10.00 12.50
______________________________________________________________________________
Direct Labour cost Pa E 5.00 7.50
______________________________________________________________________________
0.25
20h25 0.25 30h25
______________________________________________________________________________
variable overheadwstp.U.IE 5.00 7 so
______________________________________________________________________________
b 100
Total variable cost P U 20.00 27.50
______________________________________________________________________________
ie Marginal wstp.u.IE
______________________________________________________________________________
at btc
selling price p.cl E 30.00 50.00
______________________________________________________________________________
contribution P U e d 10.00 22 so
______________________________________________________________________________

Statement showing Total contribution corresponding to

______________________________________________________________________________

each sales mise

______________________________________________________________________________

______________________________________________________________________________
contribution
sales mise Total
______________________________________________________________________________
1800 units 18,000
______________________________________________________________________________
of X Note
1800 units 10
______________________________________________________________________________
Fixed cost is
1200 units 27,000 irrelevant for decision
______________________________________________________________________________
of Y 1200 units 22.50 making as
______________________________________________________________________________

the sales mise which

______________________________________________________________________________
1200 units of 21000
400 units
results in
______________________________________________________________________________Highest
of Y 1200 units 10 contribution will also
______________________________________________________________________________
400 units 22.50 result in Highest
______________________________________________________________________________

900 units of X
profit
______________________________________________________________________________
22,500
600 units goounits
______________________________________________________________________________
10
of Y Goounits 22.507
______________________________________________________________________________

we recommend sales Mise i.e 1200 units of Y as it

______________________________________________________________________________
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results in contribution
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______________________________________________________________________________
Highest
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Question 55:

Statement showingcalculation of No of units to be sold

______________________________________________________________________________
to maintain present Level of profit after reduction
______________________________________________________________________________
in selling price p u
______________________________________________________________________________
current Reduction in selling pricep.n.by
particulars
______________________________________________________________________________
data si 10 15
______________________________________________________________________________
10.00 9 50 9 00 8 so
Selling price p a E
______________________________________________________________________________
3
si 10 10 10 15
Go
______________________________________________________________________________
6 00 6 00 6.00
variable cost Pu.IE
______________________________________________________________________________
g g
______________________________________________________________________________
contributionp.cn a b E 4.00 3.50 3.00 2 so
______________________________________________________________________________
Fixed cost for the period 70,000 70,000 70,000 70,000
profit for the period 50,000 50,000
______________________________________________________________________________
50,000 50,000
Desired
______________________________________________________________________________
Desired contrin for the 120,000 1 20,000 1120,000 1 20,000
______________________________________________________________________________
period dte I
NO of 30,000 ftp.fffe 40,000 48,000
Question 56:
Ife

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Statement showing calculation ofBreak even point

______________________________________________________________________________

particulars current Increase in Decrease in

______________________________________________________________________________
original selling price selling price
______________________________________________________________________________
PU 10
data p.u.by30 by
______________________________________________________________________________

26.00 18.00
price p.u.GE
______________________________________________________________________________
selling 20.00
20730 20 10
______________________________________________________________________________

variable cost p a E
______________________________________________________________________________

i Direct material cost s s

______________________________________________________________________________
s

Ii Direct Labour cost 3 3 3

______________________________________________________________________________

iii variable on cost 2 2 2

______________________________________________________________________________

sub total 10.00 10 00 10.00

______________________________________________________________________________

______________________________________________________________________________
contribution p.u.la b 10.00 16.00 8.00
______________________________________________________________________________

Budgeted Fixed
cost 4 00,000 4 00,000 400,000
______________________________________________________________________________

for the period

______________________________________________________________________________

______________________________________________________________________________
p
______________________________________________________________________________

ES 80,000units
______________________________________________________________________________

Break even point 40,000units 25,000

units 50,000 units
______________________________________________________________________________
in units k
______________________________________________________________________________

profit volume Ratio 50 61.538461538 44.4444444

______________________________________________________________________________
a 100
______________________________________________________________________________

Break even point 650,000 900,000

______________________________________________________________________________
8109000
inant f or axe
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 57:

Also Find MOS Ratio

calculation of Break even point for
the period
______________________________________________________________________________

Fideed cost for the period

______________________________________________________________________________
BEP in units
contribution per unit
______________________________________________________________________________

______________________________________________________________________________
1180,000 1180,000
price pig v cost pig 20 14
selling
______________________________________________________________________________

118 units
______________________________________________________________________________
30,000
800
______________________________________________________________________________

BEP in amount Fixed cost for the period

______________________________________________________________________________
V Ratio
P
______________________________________________________________________________

______________________________________________________________________________

E
______________________________________________________________________________

00,0004
______________________________________________________________________________
6
______________________________________________________________________________
Turnover required to earn profit of 36,000
______________________________________________________________________________
Desired profit fixed cost for the period
______________________________________________________________________________
P v Ratio
______________________________________________________________________________

36,000 180,000 I 720,0004

______________________________________________________________________________
30
______________________________________________________________________________

At a profitof 36,000 Sales 720,000

______________________________________________________________________________
are
______________________________________________________________________________
of sales Total sales Break even
i
Margin safety
______________________________________________________________________________
sales
______________________________________________________________________________
720,000 6 00,000 120,0001
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

Mos Ratio Margin of safety sales 100

______________________________________________________________________________
Total sales
______________________________________________________________________________

______________________________________________________________________________
no
______________________________________________________________________________

______________________________________________________________________________
163
______________________________________________________________________________

______________________________________________________________________________

Question 58:

Statement showing calculation of no_of

bottles
______________________________________________________________________________
to be

sold to earn profit of 6000 for the year

______________________________________________________________________________

particulars Amt E
______________________________________________________________________________

selling price per bottle 25

______________________________________________________________________________

contribution before deducting selling g

______________________________________________________________________________

commission per bottle ax 20

______________________________________________________________________________

25 on cost means 20 on sales

______________________________________________________________________________

commission payable per bottle

______________________________________________________________________________
2 so
selling
______________________________________________________________________________
ax 10

contribution per bottle after sales 2 so

______________________________________________________________________________

commission i.e Net contribution

______________________________________________________________________________

per bottle b c
______________________________________________________________________________

Fixed cost for the Year 7,200

______________________________________________________________________________
600
per month 12 months
______________________________________________________________________________

Desired profit for the Year 6,000

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

Desired contribution for the year 13,200

______________________________________________________________________________
etf
______________________________________________________________________________
No of bottles to be sold 5,280 bottles
in a year in order to earn profit
______________________________________________________________________________

of
______________________________________________________________________________
6000
9 2
______________________________________________________________________________

______________________________________________________________________________

Question 59:

______________________________________________________________________________

talculation of Break even point

______________________________________________________________________________
Statementshowing
______________________________________________________________________________
for the period
______________________________________________________________________________

______________________________________________________________________________
Amount
particulars E
______________________________________________________________________________

price per unit 25.00

______________________________________________________________________________
selling
Trade disrount 41 1.00
onsellingpricep.u
______________________________________________________________________________

Net price per unit a b 24.00

______________________________________________________________________________
selling
variable cost p.ir
______________________________________________________________________________

i Direct material cost P U 8.00

______________________________________________________________________________

Ii Direct Labour cost P u 5.00

______________________________________________________________________________

Iii variable overhead cost pin 5Scan607 3.00

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

contribution per unit c d 8.00

______________________________________________________________________________
Fixed cost for
the period 24,000
______________________________________________________________________________

Break even point in units

fle 3,000 units
______________________________________________________________________________

P V Ratio ele 100 333

______________________________________________________________________________

______________________________________________________________________________
72,000
Break even point Net sales value

th
______________________________________________________________________________
or gxc
______________________________________________________________________________

______________________________________________________________________________

statement of profit
when sales are 1st 20
______________________________________________________________________________

above Break even sales

______________________________________________________________________________

______________________________________________________________________________
when sales are
particulars
______________________________________________________________________________
151 above 20 above
BEP BEP
______________________________________________________________________________

No_of units to be sold 3,450 units 3,600 units

______________________________________________________________________________
3000 15 3000 20
______________________________________________________________________________
contribution per unit
E 8.00 8.00
______________________________________________________________________________

Total contribution F axb 27,600 28,800

______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the period 24,000 24,000
______________________________________________________________________________
profit for the period c d 3,600 4,800
E
Question 60:

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CA Inter | Costing | Marginal Costing

calculation of Plu Ratio Break even point Margin of

______________________________________________________________________________

safety for the year

______________________________________________________________________________

original Eings ftp.egssffpcrease Increase

______________________________________________________________________________
particulars data
p.u.by lot p.u.byiot.su Hme
______________________________________________________________________________
fdb
1 Yh
E6000
______________________________________________________________________________

price per unit E gso.to 10.00 10.00 10.00

selling iy
______________________________________________________________________________
soogg
6 00 6.00
______________________________________________________________________________
variable cost per unit E 6.00 6.00
64,89
______________________________________________________________________________

contribution per unit a b 4.00 3.00 3.40 4.00 4.00

______________________________________________________________________________
E
______________________________________________________________________________
volume Ratio
profit 40.00 33ft 34001 40.00 40.001
Cla 100
______________________________________________________________________________

Fixed cost for the year 34,000 34,000 34,000 34,000 40,000
______________________________________________________________________________
E
______________________________________________________________________________
Break pointinunits 8,500
even 11,333.3333 110m
9 4 19
______________________________________________________________________________
units units
etc
______________________________________________________________________________
Break even point in amount 85,000 102,000 100,000 85,000 1 00,000
______________________________________________________________________________
axe or eld E
______________________________________________________________________________
No_of units to be sold 15,000
Iff
______________________________________________________________________________
i e sales volume units f
______________________________________________________________________________
Margin of safety inunits 8 5 3,666.6666
98
______________________________________________________________________________
units 98
h f
______________________________________________________________________________
inant
Margin of safety 65,000 33,000 50,000 85,000 50,000
______________________________________________________________________________
ax i E
______________________________________________________________________________

Mos Ratio ith 100 4331 2441 33 50.00 33

______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 61:

calculation of Break even point for 6 months ended

______________________________________________________________________________

30th sept 2018 Margin of safety

______________________________________________________________________________

______________________________________________________________________________
contribution profit Fixed expenses of half year
______________________________________________________________________________
I
30,0007 I 45,000 75,000
______________________________________________________________________________
contribution 7
i Plu Ratio
sales
10
8 100
______________________________________________________________________________
0
______________________________________________________________________________
so
______________________________________________________________________________
Fixedexpenses for half
year
Break even point for
______________________________________________________________________________
i
Half year Plu Ratio
______________________________________________________________________________
5 90,0001
93 9
______________________________________________________________________________

______________________________________________________________________________

it a s Entaies
______________________________________________________________________________

1 50,000 90,000
______________________________________________________________________________

60,0001
______________________________________________________________________________

calculation expected sales value of second half of

______________________________________________________________________________

______________________________________________________________________________
the year
______________________________________________________________________________
Fixed cost
Expected profit
PIV Ratio
______________________________________________________________________________

______________________________________________________________________________
51000
f10,000,1 70,000k
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

calculation of Break even sales Margin of safety

______________________________________________________________________________

for the year

______________________________________________________________________________
fired wst for the year 79 0
______________________________________________________________________________
i Break even sales PIV Ratio
8
______________________________________________________________________________
1 80,000
______________________________________________________________________________

Ii Margin of safety sales for the year

______________________________________________________________________________
Total sales B E Sales 2 1150,000 270,000 1 80,00
______________________________________________________________________________

2 20,000 1,801000 40,000

Question 62:

amount of Loss
Statement showing calculation of
______________________________________________________________________________

______________________________________________________________________________
expected for the period
______________________________________________________________________________
particulars Products Total
______________________________________________________________________________
A B C

______________________________________________________________________________
Sales value E 500,000 400,000 800,000 300,000 6,00000 26,00 000
______________________________________________________________________________

Vazi cost Ratio 0.60 0.50 0.65 0.80 0.75

______________________________________________________________________________
0.40 0.35 0.20 0.25
profit volume 0.50
______________________________________________________________________________
ratio 1 b
______________________________________________________________________________
Contribution axe 2 00,000 200,000 2 80,000 60,000 150,000 8,90 000
______________________________________________________________________________

Fixed cost 9 00,000

______________________________________________________________________________

Amt of profit Loss

______________________________________________________________________________
Scan For Softcopy of Notes
10,000
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CA Inter | Costing | Marginal Costing

of sales required to
______________________________________________________________________________
calculation Incremental
______________________________________________________________________________
eliminate the Loss of 10,000
______________________________________________________________________________
sale of only one product can be increased at a time
______________________________________________________________________________

product Plv Ratio Additional sales required

______________________________________________________________________________

to eliminate the of
Loss
______________________________________________________________________________
10,000
______________________________________________________________________________
5 25,0001
A 40
49
______________________________________________________________________________

______________________________________________________________________________
B 50 E
10,5 20,0001
______________________________________________________________________________

35 28,571 428571
______________________________________________________________________________
c
71039
______________________________________________________________________________
2 50,0001
20
1019T
______________________________________________________________________________

25 40,0001
______________________________________________________________________________
E 7102k
______________________________________________________________________________

______________________________________________________________________________

Question 63:

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CA Inter | Costing | Marginal Costing

data of Year 2017 Year 2018

______________________________________________________________________________
comparing
change in profit
______________________________________________________________________________
10
profit volume Ratio salesin
change
______________________________________________________________________________

______________________________________________________________________________
0
E too
______________________________________________________________________________

data of Year 2017

______________________________________________________________________________
using
______________________________________________________________________________
Fixed cost for the Year PIV Ratio
sales profit
______________________________________________________________________________
E so lakhs 40 30 lakhs
______________________________________________________________________________
30 lakhs
______________________________________________________________________________

calculation of Break even sales

for the year
______________________________________________________________________________

Fixed cost for the year

______________________________________________________________________________
3014
P U Ratio
______________________________________________________________________________

75 lakhs
______________________________________________________________________________

Sales required to earn profit of 90 lakhs

______________________________________________________________________________

______________________________________________________________________________
Desired profit Fixed cost
______________________________________________________________________________
P U Ratio
______________________________________________________________________________
90 lakhs 30 lakhs 300 lakhs
______________________________________________________________________________

______________________________________________________________________________

profit Loss when sales are 280 lakhs for the year
______________________________________________________________________________

P V Ratio Fixed cost for the year

______________________________________________________________________________
sales
30 lakhs 82 lakhs
______________________________________________________________________________
280 lakhs 40
______________________________________________________________________________

______________________________________________________________________________
Mos sales PIV Ratio
______________________________________________________________________________
280 lakhs 75 lakhs 40
______________________________________________________________________________

82 lakhs
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 64:

of first second
half of the year
comparing data
______________________________________________________________________________

______________________________________________________________________________
volume
in
change profit 10
f in sales
______________________________________________________________________________
change
______________________________________________________________________________
64,800 21,600 100
______________________________________________________________________________
1026,000 8 10,000
______________________________________________________________________________
20
E 100
______________________________________________________________________________

data First
of half
______________________________________________________________________________
using
______________________________________________________________________________
Fixed cost of sales xp u ratio profit
______________________________________________________________________________
Half year
8 10,000 20 21,600
______________________________________________________________________________
1 40,400
______________________________________________________________________________

when sales for half

______________________________________________________________________________
year
Amount of profit Loss
______________________________________________________________________________
are 6,481000
______________________________________________________________________________

sales Ratio
Plu Fixed cost of half Year
______________________________________________________________________________

El 40,400 LOSS of I 10,800

______________________________________________________________________________
EG 48,000 20
______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

Amount of sales required to earn profit

______________________________________________________________________________
of 1 80,000 in half year
______________________________________________________________________________

Desired profit Fixed cost of half year

______________________________________________________________________________

P V Ratio
______________________________________________________________________________

______________________________________________________________________________
E 80,000 1140,400 7602,0001
______________________________________________________________________________
20
______________________________________________________________________________
Break even sales forhalf year
______________________________________________________________________________

Fixed cost for half Year

119
______________________________________________________________________________

PH Ratio
______________________________________________________________________________

______________________________________________________________________________
7 02,0001
______________________________________________________________________________
Mos Ratio when Total sales are 900,000 for half Year
______________________________________________________________________________

Total sales B E Sales

______________________________________________________________________________
10
Total sales
______________________________________________________________________________

______________________________________________________________________________
900,000 702,000 10
______________________________________________________________________________
I 9,001000
______________________________________________________________________________
1 98,000
100 22.00
______________________________________________________________________________
900,000
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 65:

second half of Year

comparing data of first
______________________________________________________________________________

change in profit
______________________________________________________________________________
10 100 40
Plu Ratio sales
change in
______________________________________________________________________________

stx100
______________________________________________________________________________
variable cost ratio L IT fI foxioo
______________________________________________________________________________
601
______________________________________________________________________________

data of first half

______________________________________________________________________________
45,000 40 5,000
______________________________________________________________________________
13,0001
______________________________________________________________________________

Fixed cost for the Year 13,000 13,000

______________________________________________________________________________

26,000
______________________________________________________________________________

Break even sales for

the year
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the Year pluratio
______________________________________________________________________________

______________________________________________________________________________
E 26,000
40 65,000K
______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

or MOS Ratio
Margin of safety
______________________________________________________________________________

______________________________________________________________________________
Total salesfor the Year B E Sales for the Year
______________________________________________________________________________
Total salesfor the year
______________________________________________________________________________

95,000T 50,000 65,000

______________________________________________________________________________
100 31.5789
95,000
______________________________________________________________________________
approx
______________________________________________________________________________

Question 66:

Given data in the question is not for uniform

______________________________________________________________________________

of time It is for 3 months a months

______________________________________________________________________________
length
______________________________________________________________________________
resp
Let's convert April to December a months data
______________________________________________________________________________

into Equivalent 3 months data calculate plu Ratio

______________________________________________________________________________

______________________________________________________________________________
particulars Jan to March April to Decemember
equivalent 3 months
______________________________________________________________________________
3 months
______________________________________________________________________________
3001000 3 4,00 000
Sales E 300,000
9
______________________________________________________________________________

______________________________________________________________________________
profit E 10,000 90,000 3
30,000
______________________________________________________________________________
9
______________________________________________________________________________
change in profit 20,000
PH Ratio 10
______________________________________________________________________________
in sales
100
change 100,000
______________________________________________________________________________
20T Scan For Softcopy of Notes
______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

using data of Jan march

______________________________________________________________________________
Fixed cost for 3 months sales PIV Ratio profit
______________________________________________________________________________

3,00 000 20 10,000

______________________________________________________________________________

______________________________________________________________________________
50,000
Fixed cost for the Year 50,000 4 200,0001
______________________________________________________________________________
i

Fixed cost for the year

______________________________________________________________________________
Break even sales for the year
i______________________________________________________________________________
P U Ratio
______________________________________________________________________________
3 10,001000
______________________________________________________________________________

sales required to earn profit of 1,20 000

______________________________________________________________________________
Annual
______________________________________________________________________________
the
Desired profit Fixed cost for year
______________________________________________________________________________
PIV Ratio
______________________________________________________________________________
1 20,000 2,00 000
I 16 00,0004
______________________________________________________________________________
20
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 67:

Budget for the period

______________________________________________________________________________
production E
______________________________________________________________________________
particulars No of Electronic automatic irons produced
______________________________________________________________________________
10,000 6,000 7,000 8,000
______________________________________________________________________________

cost
______________________________________________________________________________
Marginal
i e variable cost
______________________________________________________________________________

Direct materials 6 00,000 360,000 420,000 980,000

i______________________________________________________________________________
60 P.n
______________________________________________________________________________

Direct Labour
Ii______________________________________________________________________________
3
00,000 1,80 000
2 10,000 2,40 000
230p.m
______________________________________________________________________________

000
Iii variable overheads 2 50,000 1 50,000 1,75000 2,00
______________________________________________________________________________

______________________________________________________________________________
25

P.u irselling
variable 135,000 81,000 94,500 1 08,000
______________________________________________________________________________

______________________________________________________________________________
expenses E13 so
p.u
______________________________________________________________________________
V variable Direct 50100 30,000 35,000 40,000
______________________________________________________________________________
eapenses fsp.ua
______________________________________________________________________________

Vi Distributionexpenses 40,000 24,000 28,000 32,000

______________________________________________________________________________
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sub total 13,75000 8,25000 9 62,500 11 00,000

______________________________________________________________________________

Total fixed cost for

______________________________________________________________________________
the period
______________________________________________________________________________

i Fixed overheads 1 50,000 1 50,000 1 50,000 1

50,000
______________________________________________________________________________

Ii Fixed sellingexpenses 15,000 15,000 15,000 15,000

______________________________________________________________________________

15 101 10,000
______________________________________________________________________________

Iii Administration exp 50,000 50,000 50,000

______________________________________________________________________________
50,000
Iv Fixed Distrinesep 10,000 10,000 10,000 10,000
______________________________________________________________________________
5 201 10,000
______________________________________________________________________________
sub total 2,25000 2,25000 2,25000 2,25000
______________________________________________________________________________
Total cost atb 16100,000 10 50,000 11,87500 13,25000
______________________________________________________________________________

Total cost p 4 160 175 169.64285 165.625

______________________________________________________________________________
approx
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 68:

Statement showing calculation of profit Break even

______________________________________________________________________________point
at 40 50 90
______________________________________________________________________________
capacity
______________________________________________________________________________
capacity utilisation
______________________________________________________________________________
particulars 40 50 901
______________________________________________________________________________

price perunit E 20 19.40 19.00

selling
______________________________________________________________________________
20 3 20 5
______________________________________________________________________________

Directmaterial cost 10 10 9.50

______________________________________________________________________________
PU E 10 5
______________________________________________________________________________

Direct Labour cost 3 3 3

______________________________________________________________________________
Y
2 2
______________________________________________________________________________
variable overhead 2
costp.cl E
______________________________________________________________________________

Total variable cost 15 15 14.50

______________________________________________________________________________

D4 E btctd
______________________________________________________________________________

Contributionp.u.GE a e 5.00 4.40 4.50

______________________________________________________________________________

Fixed cost for the 30,000 30,000 30,000

______________________________________________________________________________

Year s 60 10,000
______________________________________________________________________________

Break even point g f 6,000 units 6,818.181818 6,666.666666

______________________________________________________________________________
units units
______________________________________________________________________________
Break even point E 120,000 132,272.7272 1,26 666.666
______________________________________________________________________________
axh
inamount
______________________________________________________________________________
No_of units to be 10,000 Scan For Softcopy of 22,500
12,500 Notes

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CA Vinod Reddy
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Total contribution for 50,000 55,000 1 01,250
f j E
______________________________________________________________________________
the year
______________________________________________________________________________
profit 20,000 25,000 71,250
______________________________________________________________________________
for the Year E
______________________________________________________________________________
K g
______________________________________________________________________________

______________________________________________________________________________

Question 69:

calculation of price per unit

______________________________________________________________________________
selling
Total cost of 1 units 15 of Total cost
______________________________________________________________________________
50,000
1 50,000 units
______________________________________________________________________________

of
1 50,000 14 150,00022 15
Isth
______________________________________________________________________________
units
______________________________________________________________________________
1 50,000 units
______________________________________________________________________________
24 00,000 15 24,00 000 2900,000 3,60
______________________________________________________________________________
1 50,000 units 1 50,000 units
______________________________________________________________________________
18.40
______________________________________________________________________________

originally Budgeted profit 3 60,000

______________________________________________________________________________

Break even point in units

______________________________________________________________________________
Fixed cost for the period contribution p a
______________________________________________________________________________

3,00 000
______________________________________________________________________________
68,181.8181818
18.40 14 units
______________________________________________________________________________

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CA Inter | Costing | Marginal Costing

Break even point in amount

______________________________________________________________________________

BEP in units selling price pu

______________________________________________________________________________

68,181.8181818181 18.40
______________________________________________________________________________
I 12 54,545.454545
______________________________________________________________________________

calculation of profit volume Ratio

______________________________________________________________________________

contribution per unit

______________________________________________________________________________

selling price p n
100
I 100
______________________________________________________________________________

______________________________________________________________________________
23.913043478
______________________________________________________________________________
If is reduced by si
selling price p.cl
______________________________________________________________________________

______________________________________________________________________________
Revised selling price P U 18.40 5 18.40
______________________________________________________________________________
17.48
______________________________________________________________________________

Fixed cost for the period

______________________________________________________________________________
300,000
pep contribution P U 17.48 14
______________________________________________________________________________
inunits
______________________________________________________________________________
units
8965517
I 86,206
______________________________________________________________________________

BEP BEP in units sellingprice p.es

______________________________________________________________________________
inamount units 17.48
______________________________________________________________________________
86,206.8965517
______________________________________________________________________________
I 15 06,896055172
______________________________________________________________________________
contribution per unit 3.48100
Plu Ratio 100
______________________________________________________________________________
17.48
selling price p n
19.908466819
______________________________________________________________________________

Sales required for desired profit

______________________________________________________________________________

Desired profit Fixed cost 360,000 101

______________________________________________________________________________
300,00
P V Ratio
______________________________________________________________________________
19.908466819
______________________________________________________________________________
396,000 3,001000 3496,000k
______________________________________________________________________________
19.9084 668191 Scan For Softcopy of Notes

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CA Inter | Costing | Marginal Costing
Question 70:

calculation of P V Ratio for

current Year
______________________________________________________________________________

______________________________________________________________________________
Amt E Amt E
particulars
______________________________________________________________________________
selling price p u 90
Variable cost P U
______________________________________________________________________________
54
material 40
______________________________________________________________________________
Labour
______________________________________________________________________________
overheads
______________________________________________________________________________
contribution p u a b 36
______________________________________________________________________________
volume Ratio
profit a 100 40
______________________________________________________________________________

calculation of variable cost p a for

forthcoming year
______________________________________________________________________________

material cost p.ir Labour cost pin t variable 0H cost P U

______________________________________________________________________________

40 7.50 lot 10 4 5
______________________________________________________________________________

I 43 Ell t 4.20 I 58.20

______________________________________________________________________________

Calculation New price to

selling current
maintain
______________________________________________________________________________

P V Ratio
______________________________________________________________________________

contribution p.ci
______________________________________________________________________________
100
PH Ratio
selling price p.ee
______________________________________________________________________________

New selling price P U 58.20

______________________________________________________________________________
40 100
New selling price
Scan For y
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______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

p.cl 58.20
0.40 New selling price p.cn New sellingprice
______________________________________________________________________________
58.20 0.60 New
selling
______________________________________________________________________________
price p.ir

p.u.to
______________________________________________________________________________
New selling price 97.00
maintain current pluratio
______________________________________________________________________________

______________________________________________________________________________
calculation of profit of current year
______________________________________________________________________________
sales P V Ratio Fixed cost
______________________________________________________________________________

I 1350,000 40 1140,000 900,000

______________________________________________________________________________

______________________________________________________________________________
Calculation of No_of units to be sold in
______________________________________________________________________________
profit as that of
forthcoming year to earn same
______________________________________________________________________________
current year ie EG 00,000
______________________________________________________________________________

contribution D u a b 31.80
______________________________________________________________________________

Fixed cost for the forthcoming 1,44 200

______________________________________________________________________________
3
______________________________________________________________________________
1140,000
Year
______________________________________________________________________________
Desired profit for forthcoming 4 00,000
______________________________________________________________________________
Year
Desired contribution for forthcoming
______________________________________________________________________________
544,200
Year dte
______________________________________________________________________________

No_of units to be sold in forthcoming

______________________________________________________________________________
17,113.2075
units
Year to earn same profit as
______________________________________________________________________________
approx
that of current Year
______________________________________________________________________________

flc
______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing
Question 71:
Important

Statement calculation of Incremental Revenue

______________________________________________________________________________
showing
Differential cost at each stage
______________________________________________________________________________

______________________________________________________________________________

particulars volume of production for the month

______________________________________________________________________________

601 70 80 90 100
______________________________________________________________________________

______________________________________________________________________________

No of units to be 60,000 70,000 80,000 90,000 100,000

______________________________________________________________________________
sold per month
______________________________________________________________________________

selling price p.u.IE 090 0.80 0.75 0.67

______________________________________________________________________________
0.61

Total sales Revenue 54,000 56,000 60,000 60,300 61,000

______________________________________________________________________________

for the month ax b E

______________________________________________________________________________

Incremental Revenue 4,000 300 700

______________________________________________________________________________
2,000
E
______________________________________________________________________________
Total variable cost 9000 19500 12,000 13,500 15,000
______________________________________________________________________________
of goods sold I
______________________________________________________________________________
ax 0 15
Fixed cost for the
myth 40,000 40,000 40,000 40,000 40,000
______________________________________________________________________________

Total cost etf E 49,000 50,500 52,000 53,500 55,000

______________________________________________________________________________

Differential cost E 1,500 1,500 1,500 1,500

______________________________________________________________________________

profit C
g E 5,000 5,500 Scan 8,000 6,800
For Softcopy of Notes 6,000
______________________________________________________________________________
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Incremental
LOSS
CA
500Vinod
2,500 Reddy
1,200 800
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CA Inter | Costing | Marginal Costing

From above Table It is clear that profit is

______________________________________________________________________________

maximum at 80 volume of prod for the month

______________________________________________________________________________

i
company should produce sell 80,000 units per month in
______________________________________________________________________________

order to maximise the profit

______________________________________________________________________________

______________________________________________________________________________
evaluation of the proposal of export order
______________________________________________________________________________

No of units to be exported 20,000

______________________________________________________________________________

______________________________________________________________________________
Incr profit per month 7,0001
______________________________________________________________________________
if proposal is
x d
______________________________________________________________________________
accepted
______________________________________________________________________________

we recommed to accept the export order proposal

______________________________________________________________________________

______________________________________________________________________________
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Question 72:
Important

profitability statement
as per Absorption costing
______________________________________________________________________________

______________________________________________________________________________
particulars year 1 Year 2 Year 3
______________________________________________________________________________

Material cost 51200.4 12,001000 1200,000 12,00 000

______________________________________________________________________________

Labour wst E70p.us 700,000 700,000 700,000

______________________________________________________________________________

prime wst atb 1900,000 1900,000 19,00000

______________________________________________________________________________

overheads
______________________________________________________________________________
Factory
______________________________________________________________________________
vasiable E30p.cl 3
3,001000 3100,000 00,000
Fixed
______________________________________________________________________________
4100,000 4 00,000 4 00,000
sub total 700,000
______________________________________________________________________________
700,000 700,000
Total cost of production 26100,000 26,00 000 26,00 000
______________________________________________________________________________

of 10,000 units Ctd

______________________________________________________________________________

It opening stock 0 520,000 390,000

______________________________________________________________________________

390,000 o
______________________________________________________________________________
stock 260 520,000
closing Pn 260 2000 260 1500
______________________________________________________________________________
000
COGS 20 80,000 27 30,000 29,90
______________________________________________________________________________
E
Sales value 29,00 000 31,50 000 34 50,000
______________________________________________________________________________
1
8000 5300 10,500 300 11,500 300
______________________________________________________________________________
h 000 4,60 000
profit g E 3120,000 4,20
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CA Inter | Costing | Marginal Costing

profitability statement as per

marginal costing
______________________________________________________________________________

______________________________________________________________________________
particulars year 1 Year 2 Year 3
______________________________________________________________________________

Sales for the year E 24100,000 31 50,000 34150,000

______________________________________________________________________________
8000 300
10,500 300
11,500 300
______________________________________________________________________________

variable cost of goodssold

______________________________________________________________________________

i Material wst E120p.ye 9 60,000 13180,000

______________________________________________________________________________
12160,000
7 35,000 8,05000
Ii Labour cost 5 60,000
______________________________________________________________________________
700.4
it 3,15000 3,45000
______________________________________________________________________________
vasi.FactoryoH E30p.ui 2,401000
______________________________________________________________________________
23 25 30,000
sub total 1760,000 0,000
______________________________________________________________________________
contribution for the Year 6
40,000 8140,000 9,20
______________________________________________________________________________
000
a b E
______________________________________________________________________________
000
Fixed cost for the Year
E 400,000 4,00 4 00,000
______________________________________________________________________________
profit for the Year c d 2140,000 4,40 000 520,000
______________________________________________________________________________

______________________________________________________________________________
Reconciliation statement of profit
______________________________________________________________________________
particulars year 1 Year 2 Year 3
______________________________________________________________________________

as per absorption 4 20,000 460,000

______________________________________________________________________________
profit 320,000
______________________________________________________________________________
costing
______________________________________________________________________________
Add Diff in valuation
80,000 60,000
______________________________________________________________________________
of opening stock
______________________________________________________________________________
Less Difference in 80 000 60,000
______________________________________________________________________________
valuation of closing stock
______________________________________________________________________________
240P.M 12000 40 1500 40
______________________________________________________________________________
profit as per 2,40 000 440,000 520,000
______________________________________________________________________________

Marginal costing
______________________________________________________________________________
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note
working
______________________________________________________________________________
Movement of stock
______________________________________________________________________________

particulars Year 1 Year 2 Years

______________________________________________________________________________
0 2,000 1,500
opening stock
______________________________________________________________________________
No_of units produced in a year 10,000 10,000 10,000
______________________________________________________________________________
No of units soldduringthe 8,000 10,500 11,500
______________________________________________________________________________
year
atb c 2,000 1,500 0
stock
______________________________________________________________________________
closing

Question 73:
Important

calculation of Fixed overhead absorption rates

______________________________________________________________________________

i Fixed production overhead rate p.ir

______________________________________________________________________________
absorption
Total fixed prodh 0H for the year
______________________________________________________________________________
3 60,000
Normal in units
______________________________________________________________________________
90
capacity 200,000
______________________________________________________________________________
3160,000 I 2 p.m
______________________________________________________________________________
units
1 80,000
______________________________________________________________________________
ii Freed selling on absorption rate p.us
______________________________________________________________________________
Total Fixed selling on for the
year 22 70,000
______________________________________________________________________________
Normal in units 00,000 90
capacity
______________________________________________________________________________

______________________________________________________________________________
270,000 1.50 D y
180,000 units
______________________________________________________________________________

______________________________________________________________________________
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CA Inter | Costing | Marginal Costing

statement as per absorption costingfor the year

profitability
______________________________________________________________________________

______________________________________________________________________________
particulars Amt E
______________________________________________________________________________
variable production cost 11 P 4 1760,000
______________________________________________________________________________
160,000 units 11
______________________________________________________________________________
Fixed cost of production 2 p 4 3 20,000
1
60,000 units
______________________________________________________________________________
2

______________________________________________________________________________
Total cost of production of 1 60,000 20 80,000
units atb
______________________________________________________________________________

stock value 1 30,000

closing
______________________________________________________________________________

20,80 000 10,000 units

______________________________________________________________________________
460,000 units
______________________________________________________________________________
COGS c d
1950,000
______________________________________________________________________________

costs
______________________________________________________________________________
selling
i variable 1150,000
______________________________________________________________________________
E3 4150,000
Ii Fixed 1 50,000 1.50 2,25000
______________________________________________________________________________

sub total 6 75,000

______________________________________________________________________________
cost of sales of 150,000 units etf 26,25 000
______________________________________________________________________________

Sales 1150,000 units 20

30,00 000
______________________________________________________________________________

profit h 3,75000
g
______________________________________________________________________________

statement as per Marginal costingfor the year

______________________________________________________________________________
profitability
______________________________________________________________________________
particulars Amt E
______________________________________________________________________________
Sales for the year 150,000 units 20 30 00,000
______________________________________________________________________________

variable cost of goods sold

______________________________________________________________________________

i vasi.wstofprodh Ellp.ua 150,000 11 16 50,000

______________________________________________________________________________

Ii vaai.sellingwst E3p.us 1150,000 3 4 50,000

______________________________________________________________________________

21 00,000
______________________________________________________________________________
sub total
______________________________________________________________________________
contribution for the year a b 9 00,000
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Fixed cost for the year

______________________________________________________________________________

i Fixed production overheads 3 60,000

______________________________________________________________________________

Ii Fixed overheads 2 70,000

______________________________________________________________________________
selling
6 30,000
______________________________________________________________________________
sub total
______________________________________________________________________________
profit for the year c d 2 70,000
______________________________________________________________________________

______________________________________________________________________________

Reconciliation statement of profit

______________________________________________________________________________

Amt E
______________________________________________________________________________
particulars
______________________________________________________________________________
profit as per absorption costing 3,75000
______________________________________________________________________________

Less under absorption of 40,000

______________________________________________________________________________

Fixed prod OH
______________________________________________________________________________

______________________________________________________________________________
3 2
60,000 160,000 X
______________________________________________________________________________

Less under absorption of 45,000

______________________________________________________________________________

Fixed selling OH
______________________________________________________________________________

150,000 1 so
______________________________________________________________________________
2170,000
______________________________________________________________________________
Less Diff in valuation of d stock 20,000
______________________________________________________________________________

d Stock value as per absorption 1 30,000

______________________________________________________________________________

costing
______________________________________________________________________________

c stock value as per marginal 1 10,000

______________________________________________________________________________
at vasi cost of pudh 11 10,000
______________________________________________________________________________
2 70,000
______________________________________________________________________________
as per
profit Marginal costing
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 74:
Important concept of cost BEP

Basic data
______________________________________________________________________________

______________________________________________________________________________
Buy the Make the component by installing
component
______________________________________________________________________________
semi automatic Automatic
particulars
Alternative A Machine Machine
______________________________________________________________________________
Alternative B Alternative c
______________________________________________________________________________
Variable cost pay 224 15 12
______________________________________________________________________________

Fixed cost P d
______________________________________________________________________________

i Depreciation of 60,000 90,000

______________________________________________________________________________
2 0 0
90
machine 9 5
______________________________________________________________________________
8
______________________________________________________________________________
ii Fixed cost other 84,000 162,000
______________________________________________________________________________
than Depreciation
______________________________________________________________________________
sub total 1,44000 2,52000
______________________________________________________________________________

______________________________________________________________________________
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calculation of volume of output to justify switch over

______________________________________________________________________________

from purchase of component Alternative A to

______________________________________________________________________________

i semi automatic machine Alternative B

______________________________________________________________________________

______________________________________________________________________________
9 under 2 alternative
hum ftp
______________________________________________________________________________
cost BEP
Diff in variable cost P y
______________________________________________________________________________

I 1 44,000 NIL
______________________________________________________________________________
24 1s
______________________________________________________________________________

units
______________________________________________________________________________
16,000
______________________________________________________________________________
Ii Automatic machine Alternative c
______________________________________________________________________________

9 under 2 alternative
______________________________________________________________________________

cost BEP Imf ftp

______________________________________________________________________________
Diff in variable cost P y
______________________________________________________________________________
252,000 NIL 2 52,000
______________________________________________________________________________
24 12 12
______________________________________________________________________________

21,000 units
______________________________________________________________________________

______________________________________________________________________________
calculation of volume of output required to
justify
______________________________________________________________________________

switch over from semi automatic machine to Automatic machine

______________________________________________________________________________
Alternative B Alternative c
______________________________________________________________________________

9 under 2 alternative
______________________________________________________________________________
cost BEP Imf ftp
______________________________________________________________________________
Diff in variable cost P y
______________________________________________________________________________
1 44,000
252,000 8500
______________________________________________________________________________
515 12
______________________________________________________________________________
36,000 units
______________________________________________________________________________

______________________________________________________________________________
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Interpretation of cost BEP

______________________________________________________________________________

than 16,000units Best Alternative A

______________________________________________________________________________
less
16000 36,000
Units Best Alternative B
______________________________________________________________________________
more than 36,000 units Best Alternative C
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Cost BEP A B B C A C
______________________________________________________________________________
16,000 36,000 21,000
units units units
______________________________________________________________________________

required p a a Decision
______________________________________________________________________________
No_of components
______________________________________________________________________________
the component A
re 16,000 Buy
______________________________________________________________________________
16,000 a 36,000 make the compo by
______________________________________________________________________________
installing semi automatic
machine B
______________________________________________________________________________

2 36,000
make the compo by
______________________________________________________________________________

installing Automatic
______________________________________________________________________________
machine c
______________________________________________________________________________

If annual required of components is 20,000 units we

______________________________________________________________________________
recommend installation of semi automatic machine whereas
______________________________________________________________________________
considering expected
demand of 40,000 wmpo.p.ae
______________________________________________________________________________
we recommend Automatic machine
______________________________________________________________________________

______________________________________________________________________________

Question 75:
Imp_concept of composite BEP OR overall BEP

current
AtScan sales miseratio
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Statement calculation of overall BEPOR composite

______________________________________________________________________________
showing BEP
______________________________________________________________________________
products
particulars
______________________________________________________________________________
Total
P Q R s
E
______________________________________________________________________________

Sales mise Ratio 3311 413 16 83 100.00

______________________________________________________________________________

______________________________________________________________________________
Sales for the
20,000 25,000 10,000 5,000 60,000
______________________________________________________________________________
month
______________________________________________________________________________
60,000 a
Variable cost Ratio 0.60 0.68 0.80 0.40
______________________________________________________________________________

profit volumeRatio 0.40 0.32 0.20 0.60

______________________________________________________________________________
t c
______________________________________________________________________________
contribution for the 8,000 8,000 2,000 3,000 21,000
month bad
______________________________________________________________________________
P V 100 35
21,000 2
91 8
______________________________________________________________________________
60,000
______________________________________________________________________________
deed for the
overall BEP OR Finth
composite BEP 14,0440,000
______________________________________________________________________________
overall PIU ratio
______________________________________________________________________________

This is BEP for the month at

______________________________________________________________________________
current sales mise ratio
______________________________________________________________________________
cross check
______________________________________________________________________________

______________________________________________________________________________
products sales Ratio contribution
PIV
p 40,000 3337 13,333.33333 40 5333.3333
______________________________________________________________________________

Q 40,000 41 1 16,666.666666 32 5333.33333

______________________________________________________________________________
6,666.66666 20 1333.33333
R 40,000 16331
______________________________________________________________________________

5 40,000 8 3,333 33333 601 2,000

______________________________________________________________________________

Total
______________________________________________________________________________
14,000
______________________________________________________________________________
Less Fixedwst 14,000
______________________________________________________________________________

profit LOSS zero

______________________________________________________________________________
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Question 76:
Important

Analysis of cost for Bhutanese subsidiary

______________________________________________________________________________

______________________________________________________________________________
total variable Fixed variable
particulars cost cost E
annual cost E
______________________________________________________________________________
p off
______________________________________________________________________________
5 25
Materials 210,000 2,8 81
______________________________________________________________________________
210,00040,000

Labour 1 50,000 1,20 000 30,000 3.00

______________________________________________________________________________
150,000 801 120,00040,000
______________________________________________________________________________

______________________________________________________________________________
1.38
overheads 92,000 55,200 36,800
Factory
55,20040,000
______________________________________________________________________________
92,000 601
Admini overheads 40,000 14,000 26,000 0.35
______________________________________________________________________________
40,000 351 14,00040,000
______________________________________________________________________________
Total 92,800 9.98
______________________________________________________________________________

i Total Fixed cost for the year

______________________________________________________________________________
92,800
8 selling price
______________________________________________________________________________
variable cost p u 9.98
per bottle
______________________________________________________________________________

Let E se per bottle be selling price for Bhutan

______________________________________________________________________________

subsidiary
______________________________________________________________________________
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Sales 9 of for profit for the

49 s If 1st
______________________________________________________________________________
Year
______________________________________________________________________________

9.98 40,000 40,0002 81 92,800 10 40,000

______________________________________________________________________________
40,0002
______________________________________________________________________________
3,99200 32002 92,800 40002
40,0002
______________________________________________________________________________
32002 40002 0
40,0002 3,99 200 92,800
______________________________________________________________________________

328002 4 92,000
______________________________________________________________________________

a 151
______________________________________________________________________________

selling price per bottle For Bhutanese

______________________________________________________________________________
in order to
subsidiary should
be Is earn
______________________________________________________________________________

10 profit on sales
______________________________________________________________________________

______________________________________________________________________________
Calculation of Break even point when
______________________________________________________________________________

per bottle is14

selling price
______________________________________________________________________________

______________________________________________________________________________
i Annual Fixed cost 92,800
______________________________________________________________________________
ii ______________________________________________________________________________
contribution per bottle
911 push ie
______________________________________________________________________________
14 81 14 11.10
14 9.98
______________________________________________________________________________
2.90
______________________________________________________________________________
Annual fixed cost 92,800
i ______________________________________________________________________________
point
EY Gen unbi per bottle 2.90
______________________________________________________________________________

32,000 bottles
______________________________________________________________________________

______________________________________________________________________________
Iv Break even point BE p in units price per bottle
selling
______________________________________________________________________________
in amount
32,000 bottles 14
______________________________________________________________________________
4 48,0001
______________________________________________________________________________

______________________________________________________________________________
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Question 77:

AS P V Ratio 60 0.60
______________________________________________________________________________

we can that variable cost ratio 1 0.60

______________________________________________________________________________
say 0 40 40
______________________________________________________________________________

______________________________________________________________________________
cost p 4 variable cost p n 20
Marginal
______________________________________________________________________________
variable cost p.es
sellingprice p.cn
variable cost ratio
______________________________________________________________________________

50
______________________________________________________________________________

Question sales for the Quarter 80,000

______________________________________________________________________________
Mos Ratio 35
______________________________________________________________________________
Plv Ratio
______________________________________________________________________________
I 5,000
profit for the Quarter
sales for the quarter MOS Ratio Plu Ratio profit
______________________________________________________________________________
80,000 351 P V Ratio 5000
______________________________________________________________________________
P u Ratio 17.8571428571
Question 78:

______________________________________________________________________________
As variable cost ratio 70 we can that
say
______________________________________________________________________________
ratio 30
profit volume
______________________________________________________________________________

sales Break even point sales

______________________________________________________________________________
capacity 60

sales Fixed cost for the period

______________________________________________________________________________
capacity 60
PIV Ratio
______________________________________________________________________________
9
capacity sales 9 300,000
______________________________________________________________________________
60
______________________________________________________________________________
capacity sales I 500,000
______________________________________________________________________________

profit at 75 of
capacity sales
______________________________________________________________________________
Plv Ratio Fixed cost
capacity sales 75
______________________________________________________________________________

22,5001
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______________________________________________________________________________
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Question 79:

fixed cost Fixed cost

p u ratio 100
P V Ratio
______________________________________________________________________________
B E sales B E sales
______________________________________________________________________________
100
9 100
______________________________________________________________________________
25
______________________________________________________________________________
profit for the period profit for the period
______________________________________________________________________________
PH Ratio 14T Bates Plu Ratio
14T Bates
______________________________________________________________________________
40,000 257
20,000
______________________________________________________________________________
25
2,00 000 160,000
Loss of 5,0001
______________________________________________________________________________
25 10,000
40,000
ORO
ORO
______________________________________________________________________________
sales P V Ratio Fixed cost
sales PVRatio Fixed cost
______________________________________________________________________________
25
20,000 10,000
2100,000 25 40,000 E
______________________________________________________________________________
5,000 10,000
50,000 40,000 10,000k Loss of 50001
Question 80:

cost indiff point means

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CA Inter | Costing | Marginal Costing

Given data E
______________________________________________________________________________

particulars Manual A semi automatic B automatic C

______________________________________________________________________________
Fully
______________________________________________________________________________
Fixed cost
Monthly
i occupancy 15,000 15,000 15,000
______________________________________________________________________________
ii maint contract 5,000 10,000
______________________________________________________________________________
Iii Equip Lease 25,000 1 00,000
______________________________________________________________________________
sub total 15,000 45,000 1 25,000
______________________________________________________________________________
Vasi cost per case
i supplies 40 80
______________________________________________________________________________
Ii Labour 200 28
______________________________________________________________________________
sub total 290 1 0 40
calculation of cost indifference points i e cost BEP between
______________________________________________________________________________

______________________________________________________________________________
Alternatives
______________________________________________________________________________
A B B C Afc
______________________________________________________________________________
cost BEP
Diff in Fixed cost If
______________________________________________________________________________
100
______________________________________________________________________________
p.m under salt
300 cases 800 cases socases
______________________________________________________________________________
step
______________________________________________________________________________

Interpretation of cost BEP

______________________________________________________________________________

______________________________________________________________________________
Decision
No of cases per month a
______________________________________________________________________________
2 300 Manual
______________________________________________________________________________
300 2800 Semi Automatic
se
______________________________________________________________________________
se 800 Automatic
Fully
______________________________________________________________________________
For 600 cases p.m semi automatic system is advisable
______________________________________________________________________________
but considering expected case load of 850 cases per month
______________________________________________________________________________

we recommend automatic
Fully system
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
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Question 81:

______________________________________________________________________________

______________________________________________________________________________
Given data
______________________________________________________________________________
No of units sold profit Loss sales E
______________________________________________________________________________
8000 X1,20 15 000
8000 8000 X 5 90,000
______________________________________________________________________________

20,000 20,000 80,000 20,000 2 15 300,000

______________________________________________________________________________
4
______________________________________________________________________________
P Ratio change profitin
u
______________________________________________________________________________
in sales
change
______________________________________________________________________________
80,000 40,000
______________________________________________________________________________
100
3
00,000 1 20,000
______________________________________________________________________________

663
______________________________________________________________________________
100
______________________________________________________________________________
data of 8,000 units
using
______________________________________________________________________________
Fixed cost for the sales Plv Ratio profit
______________________________________________________________________________
period 40000
El 20,000 66 666666
______________________________________________________________________________

______________________________________________________________________________
40,000
80,000
El 20,000
______________________________________________________________________________

period
______________________________________________________________________________
Fideed cost for the
BEP in amount
P V Ratio
______________________________________________________________________________

______________________________________________________________________________
II
______________________________________________________________________________
80,0001
______________________________________________________________________________
BEP in amt
BEP inunits 8,9000
______________________________________________________________________________
selling price
pin
______________________________________________________________________________
12,000 units Scan For Softcopy of Notes
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OR
______________________________________________________________________________

______________________________________________________________________________
Let contribution p.u.be Ese
______________________________________________________________________________
Fixed cost for the period be Ey
______________________________________________________________________________
data
As per given
______________________________________________________________________________

______________________________________________________________________________
80002 8000 5
y
______________________________________________________________________________

80002
______________________________________________________________________________
y 40,000 0

______________________________________________________________________________

20,0002 y 20,000 4
______________________________________________________________________________

______________________________________________________________________________
0
20,0002 Y 80,000
______________________________________________________________________________
solving Eths simultaneously
______________________________________________________________________________
80002 y 40,000 0
______________________________________________________________________________
0
20,000 y 780,000
______________________________________________________________________________

12,0002 0
______________________________________________________________________________
1 20,000
2 10
1 20,000 12,0002
______________________________________________________________________________

Let's Eth
______________________________________________________________________________
use 8000110 y 40,000 O

______________________________________________________________________________
000
i 1,20
Y
______________________________________________________________________________
Fixed cost for the period El 20,000
i______________________________________________________________________________
contribution per unit 10
______________________________________________________________________________

______________________________________________________________________________
calculation of Break even point for the period
______________________________________________________________________________
units
i BEP inunits ftp.wf 12,000
______________________________________________________________________________

______________________________________________________________________________

Ii BEP in amount BEP inunits selling price p u

______________________________________________________________________________
1 80,0001
12,000 units 15
______________________________________________________________________________
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Question 82:

calculation of overall BEP

______________________________________________________________________________
Statementshowing
______________________________________________________________________________
If company replaces product'M by product O
______________________________________________________________________________

product o product N Total

particulars
______________________________________________________________________________

______________________________________________________________________________

price p.U.FI 18 is
______________________________________________________________________________
selling
______________________________________________________________________________
1.50
variable wstp.u.IE 9
______________________________________________________________________________
contribution P U E g 13.50
______________________________________________________________________________
a b
No_ofunits to be
9,000 18,000
______________________________________________________________________________
sold
______________________________________________________________________________
Total contribution 81,000 2,43000 324,000
______________________________________________________________________________
Itd E
Total sales axd 1 62,000 4 32,000
______________________________________________________________________________
2 70,000
______________________________________________________________________________
E
overall P V Ratio Total conti from all products
______________________________________________________________________________
100
Total sales
______________________________________________________________________________
I 3,24 000 100 75
______________________________________________________________________________
I 4 32,000
______________________________________________________________________________
total filled cost for theperiod
eographfeak
______________________________________________________________________________
overall P V Ratio
______________________________________________________________________________
E 15,000 75
7 20,0001
______________________________________________________________________________

______________________________________________________________________________
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cross check with calculation of BEP in units

______________________________________________________________________________

______________________________________________________________________________
particulars sales 162 270 18 unitstobepwft.si Total contribution
______________________________________________________________________________
product 416.6666666
0 7,500 9 3,750
______________________________________________________________________________
7500 18
833.333333 13.50 11,250
______________________________________________________________________________
product N 12,500
12,500 15
______________________________________________________________________________
Total 20,000 15,000
______________________________________________________________________________

______________________________________________________________________________
No_of unitssold 1 2
______________________________________________________________________________

Total contribution Fixed cost

profit
______________________________________________________________________________

15,000 215,000 Zero

______________________________________________________________________________

Question 83:

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Calculation of sales value to be obtained for

______________________________________________________________________________

______________________________________________________________________________
Break even
______________________________________________________________________________
Fixed cost for the period
cost ratio
______________________________________________________________________________
P V Ratio
______________________________________________________________________________

79 8 1 91 200,000
______________________________________________________________________________

______________________________________________________________________________

Sales required for earning return of investment of

______________________________________________________________________________
15

______________________________________________________________________________
cost for the period
Desired profit Fixed
______________________________________________________________________________
profit volume ratio
______________________________________________________________________________
15 80,000 30,000 80,000
200,000
______________________________________________________________________________
40
40
______________________________________________________________________________

f 2,750001
______________________________________________________________________________

______________________________________________________________________________

calculation of shut down point in amount

______________________________________________________________________________

Avoidable Fixed cost

______________________________________________________________________________
80,000 25000
P U Ratio
______________________________________________________________________________

______________________________________________________________________________
5

1 91 1,375001
______________________________________________________________________________

______________________________________________________________________________
less than
If company is expecting sales of
______________________________________________________________________________

It is advisable to
I1,37 500 for the period
______________________________________________________________________________

shut down the Business

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

668 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 84:

statement of profit with 101 increase in selling price

______________________________________________________________________________

reduction in sales volume

______________________________________________________________________________
10
______________________________________________________________________________

particulars Amt E Amt E

______________________________________________________________________________

No_of cars to be sold as

______________________________________________________________________________
40,000
Budget
______________________________________________________________________________
per
No_of cars to be sold after 36,000
______________________________________________________________________________

10 reduction in sales volume

______________________________________________________________________________

40,000 10 40 000
______________________________________________________________________________

price per car as per 1,750

______________________________________________________________________________
selling
E 70000,000 40,000units
______________________________________________________________________________
Budget
______________________________________________________________________________
Revised selling price per car 1,925
After 10 increase 1750 10
______________________________________________________________________________

______________________________________________________________________________
Total variable cost per car
1,100
______________________________________________________________________________
2,6400,000 40,000 660
i Materials
______________________________________________________________________________
Ii Labour 5200,000 40,000 130
______________________________________________________________________________
Iii Direct expenses 1,2400,000 40,000 310
______________________________________________________________________________
Scan For Softcopy of Notes
contribution per car d e 825
#CostingbyVR CA Vinod Reddy
______________________________________________________________________________

669 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

Total contribution for the month 2,97 00,000

______________________________________________________________________________
bxf
______________________________________________________________________________
Total fixed cost for the month
2,02 50,000
______________________________________________________________________________

i specific fixed cost

______________________________________________________________________________
90 00,000
Ii Allocated Fixed cost 1,1250,000
______________________________________________________________________________

______________________________________________________________________________
Estimated profit for the man 94 50,000
increase in selling
______________________________________________________________________________
after 10
price 10 reduction in
______________________________________________________________________________
sales volume
g h
______________________________________________________________________________

calculation of volume to be acheived

______________________________________________________________________________
statement showing
to be sold to maintain original profit
______________________________________________________________________________
ie No_of cars

after 10 increase in material cost

______________________________________________________________________________

______________________________________________________________________________
particulars Amt E Amt E
______________________________________________________________________________

selling price per car 1,750

______________________________________________________________________________

Total variable cost per car

______________________________________________________________________________
1,166
i Material 10 726
______________________________________________________________________________
660

Ii Labour
______________________________________________________________________________
130
iii Direct expenses 310
______________________________________________________________________________

contribution per car a b 584

______________________________________________________________________________

______________________________________________________________________________
Total fixed cost for the
2,02 50,000
______________________________________________________________________________
month
Desired profit ie originally 57 50,000
______________________________________________________________________________

Budgeted profit
______________________________________________________________________________

______________________________________________________________________________
I 6,4250,000
700,00 000
Desired contribution for the month 2,60 00,000
______________________________________________________________________________

dte
______________________________________________________________________________

of cars to be sold in a
______________________________________________________________________________
No 44,521 cars
Scan For Softcopy of Notes
monthf
#CostingbyVR CA Vinod Reddy
approx
______________________________________________________________________________

670 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

______________________________________________________________________________

Question 85:

______________________________________________________________________________
data of Year 2018 Year 2019
comparing
______________________________________________________________________________

change in profit
______________________________________________________________________________
volume
Iff
10
in sales
______________________________________________________________________________
change
______________________________________________________________________________
13,000 8,000
______________________________________________________________________________
1140,000 1120,000
______________________________________________________________________________

______________________________________________________________________________
525 100 25.00
______________________________________________________________________________
data of Year 2018
using
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the
sales Plv Ratio profit
______________________________________________________________________________
Year
1120,000 25 8,000
______________________________________________________________________________

8,000
______________________________________________________________________________
30,000
22,0001Scan For Softcopy of Notes
______________________________________________________________________________
#CostingbyVR CA Vinod Reddy
671 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

Break for the year

point
______________________________________________________________________________
even

______________________________________________________________________________
Fixed cost for
the year
______________________________________________________________________________
PN ratio
______________________________________________________________________________

88,000
______________________________________________________________________________

______________________________________________________________________________
profit when sales are180,000 for the year
______________________________________________________________________________
sales Plv Ratio Fixed cost for the year
______________________________________________________________________________
EI 80,000 25 I 22,000 23,000
______________________________________________________________________________

______________________________________________________________________________
sales B E sales P V Ratio
______________________________________________________________________________
1 80,000 88,000 25 23,0001
______________________________________________________________________________
Margin of safety sales for Year 2019
______________________________________________________________________________

Total sales of Year old B E sales for

______________________________________________________________________________
the Year

88,000 52,0001
______________________________________________________________________________
1 40,000

Question 86:

Data of Year 2017

______________________________________________________________________________
1
60
______________________________________________________________________________
price P U
selling
MOS Ratio 40
______________________________________________________________________________

Fixed cost for the year 3,60 000

______________________________________________________________________________
vasi cost Ratio
80
______________________________________________________________________________
profit volume Ratio 20
______________________________________________________________________________
contribution P U 60 20 12
______________________________________________________________________________
48
variable cost Pu 260 801
Scan For Softcopy of Notes

#CostingbyVR
profit earned 240,000
CA Vinod Reddy
______________________________________________________________________________
refer 3
672 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

callulation of selling price p u for 2018 to earn

______________________________________________________________________________

same plu Ratio as in 2017

______________________________________________________________________________

Let Eae be selling price p.ir for

Year
______________________________________________________________________________
2018

contribution p.ci
______________________________________________________________________________
Ratio 100
PH selling price p.u
______________________________________________________________________________

selling price p.cl Vasi Wst P U

______________________________________________________________________________
20 100
selling paire p.u
______________________________________________________________________________

48 101
______________________________________________________________________________
0.20
x
______________________________________________________________________________
0.202 2 52.80
______________________________________________________________________________
52.80 0.802
______________________________________________________________________________
i a
8 88 661
______________________________________________________________________________

calculation of profit earned in 2017

______________________________________________________________________________

______________________________________________________________________________
B E sales for 2017
1 8 1 1 effge
______________________________________________________________________________

18,00,000
______________________________________________________________________________

Total sales B E sales

______________________________________________________________________________
Mos Ratio Total sales
______________________________________________________________________________

Total sales18,00 000

______________________________________________________________________________
0.40
Total sales
______________________________________________________________________________

0.40 Total sales Total sales

______________________________________________________________________________
18,00 000
18,00 000 0.60 Total sales
______________________________________________________________________________

______________________________________________________________________________
i Total sales 30100,000
sales Plu ratio Fixed cost
______________________________________________________________________________
earned
i profit
______________________________________________________________________________
20 3,60 000
30,00 000
______________________________________________________________________________
2,40 000
______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

673 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

calculation of no_of units to be sold in 2018 to

______________________________________________________________________________
earn

same profit as 2017

______________________________________________________________________________

______________________________________________________________________________
Desired profit Fixed cost
______________________________________________________________________________
contribution p.u
______________________________________________________________________________
3160,000 5
240,000
______________________________________________________________________________

selling price p.ir vasi.wstp.ir

______________________________________________________________________________

______________________________________________________________________________
3 78,000
2,40 000 6 18,000
______________________________________________________________________________
60 48 10 60 52 80
______________________________________________________________________________

0
85,833 3333333 units
______________________________________________________________________________
9
______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

674 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 87:

______________________________________________________________________________
unit sellingprice pu Marginal cost pu
contribution per
______________________________________________________________________________
15 12 3
______________________________________________________________________________
contribution p.ir
profit volume Ratio
______________________________________________________________________________
price p n
selling
______________________________________________________________________________

If 100 20
______________________________________________________________________________

______________________________________________________________________________
Margin of safety sales Pythia f 52,59000
______________________________________________________________________________

______________________________________________________________________________

Margin of safety
in units 1TH mar II
______________________________________________________________________________

16,666.666666 units
______________________________________________________________________________

Question 88:

of sales I 2 40,000
______________________________________________________________________________
Margin safety
______________________________________________________________________________
Total sales 6,00 000
2,40 000 401
Margin of safetysales
______________________________________________________________________________
Break even sales total sales
2,40 000
______________________________________________________________________________
EG 00,000
3,60 000
______________________________________________________________________________

Amount of when sales are

______________________________________________________________________________
profit 000
9,00
sales B E Sales P V Ratio
______________________________________________________________________________

______________________________________________________________________________
000 3 60,00 X 30
9,00
______________________________________________________________________________
El 62,0001
______________________________________________________________________________
Scan For Softcopy of Notes
______________________________________________________________________________
#CostingbyVR CA Vinod Reddy
675 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

contribution 2,00 000

______________________________________________________________________________
Total sales I
8,00 000
______________________________________________________________________________

i P U Ratio Tim 100

______________________________________________________________________________

E's no si
______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the period contribution profit
______________________________________________________________________________
2,00 000 1 50,000
______________________________________________________________________________
50,000
______________________________________________________________________________
Break even sales Fixed cost PIV Ratio
______________________________________________________________________________
2
E 50,000 251 00,000
______________________________________________________________________________

sales Total sales Break even sales

Margin of safety
______________________________________________________________________________

2,00 000
______________________________________________________________________________
8,001000
6,000001
Question 89:

Margin of
safety in ant
selling price p u
______________________________________________________________________________
margin of safety in units
______________________________________________________________________________
50.00
______________________________________________________________________________
Break even sales BEP inunits sellingpricep.cn
______________________________________________________________________________
units 50
1,250 62,500
______________________________________________________________________________
Total sales Break even sales Mos sales
I 62,500 1 87,500 2,50 000
______________________________________________________________________________

profit Total sales Total cost 250,000 1,93750 56,250

______________________________________________________________________________

PluRatio tales 100 58358 100 30.00

______________________________________________________________________________

______________________________________________________________________________
Fixed cost for the B E sales Ratio
P V Scan For Softcopy of Notes

#CostingbyVR
period CA
30 Vinod Reddy
______________________________________________________________________________
62,500 18,7501
676 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing
Question 90:

Also show BEP on

Graph for revised selling
calculation of Break even point
price
______________________________________________________________________________

Fixed cost for the period

______________________________________________________________________________

contribution perunit II 100

______________________________________________________________________________

88
1
units
188
______________________________________________________________________________
40,000
______________________________________________________________________________
even chart
Break
axis adf.gg wstvine uaziablfst
______________________________________________________________________________
f
______________________________________________________________________________
at total
vine
______________________________________________________________________________
New BE sales
Amount 9000,000
______________________________________________________________________________
Amount E 80,00000
______________________________________________________________________________
BEP inamount
______________________________________________________________________________
40,00 000 Fixed
Total
______________________________________________________________________________
cost
______________________________________________________________________________

______________________________________________________________________________
X axis
units 50,000 units New BEP
BEF If L
______________________________________________________________________________
No units produced sold
of
______________________________________________________________________________

______________________________________________________________________________

if sellingprice is reduced to 180 p.ir

Calculation of BEP
______________________________________________________________________________

Fixed cost for period

the 90100,000
______________________________________________________________________________
BEP in units selling price p u
v cost py 180 100
______________________________________________________________________________

50,000 units
______________________________________________________________________________

______________________________________________________________________________
units 180
BEP inamount 50,000
______________________________________________________________________________
90,000004
Scan For Softcopy of Notes
______________________________________________________________________________
#CostingbyVR CA Vinod Reddy
677 vinod.reddy.ca@gmail.com
CA Inter | Costing | Marginal Costing

______________________________________________________________________________

______________________________________________________________________________
Scan For Softcopy of Notes

#CostingbyVR CA Vinod Reddy

______________________________________________________________________________

678 vinod.reddy.ca@gmail.com

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