#title.Case Study., Cost Accounting

A retail dealer in garments is currently selling 24000 shirts annually. He supplies the following details for the year ended 31st December,2007.
Selling Price per shirt 40
Variable Cost per shirt 25
Fixed cost:
staff salaries for the year 120000
General office cost for the year 80000
Advertising costs for the year 40000

As a cost accountant of the firm, you are required to answer the following each part independently:-
(i) Calculate the break-even point and margin of safety in sales revenue and no of shirts sold.
(ii) Assume that 20000 shirts were sold in a year. Find out the net profit of the firm.
If it is decided to introduce selling commission of Rs 3 per shirt, how many shirts would require to be sold in a year to earn a net income of Rs 15000/-.
Posted Date: 6/29/2015 6:44:43 AM | Location : Sudan

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