Solution-What flexible budget showing profit capacity

What flexible budget showing profit capacity utilization

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Reference no: EM132548817

A factory is engaged in manufacturing plastic toys is working at 40% capacity and produces 10,000 toys per month. The present cost breakup for one toy is as under.

Material cost Rs. 10 ;

Labor cost Rs. 3

Overhead cost Rs.5 (60% fixed)

Question 1: The selling price is Rs.20 per toy. If it is decided to work the factory at 50% capacity, the selling price falls by 3%. At 90% capacity, the selling price falls by 5%. There is similar fall in the price of material. flexible budget showing profit/losses at 40%, 50% and 90% capacity utilization?

Reference no: EM132548817

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What flexible budget showing profit capacity utilization

Reference no: EM132548817

Reference no: EM132548817

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