What do you understand by marging of safety, Managerial Accounting

Assignment Help:

Question:

(a) A retail store wants to evaluate how many units it must sell in order to earn a profit of Rs 10000 per month if the price of the unit is Rs 300, the average variable cost is Rs 100, and the fixed costs are Rs 5000 per month. If the store prices the unit at Rs 350, would that make a difference? On the other hand, if the price is Rs 350 and the variable costs fall to Rs 85 would that make a difference?

(b) What do you understand by ‘Marging of Safety'?

(c) Describe how the determination of the Break Even Point can help for planning purposes.


Related Discussions:- What do you understand by marging of safety

The securities and exchange commission (sec), Explain:- Q.1 As a potent...

Explain:- Q.1 As a potential investor, what is the problem with different countries having different accounting standards? As the president of a multinational company, what is

Types of simulation-operational gaining-monte carlo method, Types of Simula...

Types of Simulation 1) Operational Gaining Method: This refers to those situations involving conflict of interest among players or decision makers within the framework o

Invoice discounting or factoring, If a company creates sales to a number of...

If a company creates sales to a number of customers on credit terms this will have to wait for two or still three months before its debtors pay that they owe. It means that the deb

Advantages of marginal costing, Problem Marginal costing plays a major ...

Problem Marginal costing plays a major role in making certain decisions. It provides information to management regarding the behaviour of costs and the incidence of such costs

Chapter 2 problem 2-23 T-Accounts;applying overhead, solution to problem 2-...

solution to problem 2-23,T-Accounts;applied overhead of Kleinman Company is a manufacturing firm and employess a job-order costing system.

Implementation of abc analysis, Implementation of ABC analysis The foll...

Implementation of ABC analysis The following steps are included in implementing the ABC analysis: 1. Categorize the items of inventories, establishing the expected use in un

Make and b, The Rohr Company’s old equipment for making subassemblies is wo...

The Rohr Company’s old equipment for making subassemblies is worn out. The company is considering two courses of action: (a) Completely replacing the old equipment with new equipme

Multiple regression, MULTIPLE REGRESSION The least square regression eq...

MULTIPLE REGRESSION The least square regression equation discussed above was based on the assumption that total cost was determined by only one activity based variable. However

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd