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Solution Lakme India LTD

This document provides financial information for Lakme India Ltd, including machinery costs, expected life, selling price, variable costs, fixed costs, depreciation, expected sales, and tax rate. It then calculates the profit before tax, tax amount, and profit after tax based on selling 150000 units. The contribution per unit is Rs. 400, fixed costs are Rs. 25 lakhs, profit before tax is Rs. 575 lakhs, tax is Rs. 287.5 lakhs, and profit after tax is Rs. 287.5 lakhs plus depreciation of Rs. 10 lakhs for a total cash profit of Rs. 297.5 lakhs.

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Bhagyashree Mohite
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99 views4 pages

Solution Lakme India LTD

This document provides financial information for Lakme India Ltd, including machinery costs, expected life, selling price, variable costs, fixed costs, depreciation, expected sales, and tax rate. It then calculates the profit before tax, tax amount, and profit after tax based on selling 150000 units. The contribution per unit is Rs. 400, fixed costs are Rs. 25 lakhs, profit before tax is Rs. 575 lakhs, tax is Rs. 287.5 lakhs, and profit after tax is Rs. 287.5 lakhs plus depreciation of Rs. 10 lakhs for a total cash profit of Rs. 297.5 lakhs.

Uploaded by

Bhagyashree Mohite
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Solution

LAKME INDIA LTD

1) Machinery Cost = 100,0000


2) Expected Life = 10 Years
3) Selling Price = Rs 1250
4) Variable Cost = Rs 850
5) Fixed Cost = Rs 2500000
6) Depreciation = Rs 1000000
7) Expected Sale = 150000 Units
8) Tax Rate = 50%

Units 150000 Per Unit Rs in Lakhs


A) Selling Price 1250
B) Variable Cost 850
C) Contribution 400 600
D) Fixed Cost 25
E) Profit Before Tax(C-D) 575
F) Tax @ 50% on E 287.5
G) Profit after Tax (E-F) 287.5
H) Depreciation 10.0
I) Cash Profit (G+H) 297.5
3)

Yes agree with the statement given by CEO Of M-Mart Ltd

Every Company has to keep adequate working capital at any point


of time. Further the needs vary with the market demand &
supply. Hence there is need for every business organization to
identify the different types of working capital needs based on
market conditions. They also vary according to season, where the
company is engaged in catering to seasonal products do their
products.

The working capital needs vary according to


 Market demand
 Types of Markets(Both Domestic & International Markets)
3)
GEMS Pharma

Selling Price = Rs 275 per unit


Fixed Cost = Rs 55700
Variable Cost = Rs 165 Per Unit

a)

Units 8000 Per Unit Rs in Lakhs


A) Selling Price 275 22
B) Variable Cost 165 13.2
C) Contribution 110
D) Fixed Cost 0.557
E) Profit Before Tax(C-D) 8.243

CVP = FIXED COSTS


Contribution/Unit

CVP = 506.36 (Units)


PE Ratio = CONTRIBUTION * 100
SALES
PE RATIO= 40%
b)

Units 8000 Per Unit Rs in Lakhs


A) Selling Price 275 22
B) Variable Cost 165 13.2
C) Contribution 110 8.8
D) Fixed Cost 0.95
E) Profit Before Tax(C-D) 7.85

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