Chapter- 4
Marginal Costing
Problems
[Link] out the amount of profit earned during the year using marginal costing technique based on
the below given information.
Fixed Cost:6,00,000 Variable Cost: 10 per unit
Selling Price: ₹15 per unit Output Level: 1,50,000 units.
2. What is the Profit-Volume (P/V) Ratio if sales are ₹16,00,000, variable costs are ₹6,00,000, and
fixed costs are ₹3,00,000?
3. Given the following figures, Calculate the Break-Even Point (BEP):
Fixed Expenses ₹ 1,20,000, Variable Cost per unit 10, Selling Price per unit 16
4. If the Selling Cost is 12 per unit, Total Fixed Cost is 12,000, and Variable Cost is 9 per unit,
Calculate the Profit-Volume (P/V) Ratio, Break-Even Point (BEP) in Units and Value.
5. Given the following data:
Total Fixed Cost: 12,000, Selling Cost: 12 per unit Variable Cost: ₹ 9 per unit.
What will be the Profit When sales are (a) ₹60,000 and (b) ₹1,00,000,
What will be the amount of sales if it is desired to earn profit of (a) ₹6,000 and (b) ₹15,000.
6. The following data are available from the records of the company
Sales ₹80,000, Variable Cost 30,000; Fixed Cost 15,000
Calculate-
• PV ratio, BEP and Margin of Safety.
• Calculate the effect of 10% increase in sale price
• Calculate the effect of 10% decrease in sale price
7. The following data are available from the records of the company
Sales ₹60,000; Variable Cost 30,000; Fixed Cost 15,000
Calculate-
• PV ratio, BEP and Margin of Safety at this level
• Calculate the effect of 10% increase in sale price
• Calculate the effect of 10% decrease in sale price.
8. The following information related to production and sales of an article for January and February
2020.
Particular January (₹) February (₹)
Sales 38,000 65,000
Profit --- 3,000
Loss 2,400 ---
Calculate PV Ratio, Fixed Cost, BEP, Profit or Loss at 46,000 Sales and Sales to earn a profit of₹
5,000.
9. The following costs and sales of a manufacturing company for the first half and second half of
2019-2020 is given:
Particular I Half II Half
Sales 24,00,000 30,00,000
Total Cost 21,80,000 26,00,000
Find P/V Ratio of the firm, Annual Fixed Costs, BEP, and MOS as percentage of sales.
10. Lucky buckets sold 14,000 buckets and 18,000 buckets at ₹50 per bucket in two consecutive
years. The company incurred a loss of 10,000 in first and earned a profit of ₹10,000 in the second
year. Find out amount of Fixed Cost, BEP in Units and Sales required to earn a profit of ₹35,000.
Particular I year II year
Sales (14,000 *50) =7,00,000 (18,000 *50) = 9,00,000
Loss 10,000 ---
Profit ---- 10,000
11. Calculate P/V Ratio, Break Even Sales with the help of P/V ratio and Sales required to earn a
profit of 4,50,000.
Given Information:
Fixed Expenses: ₹90,000, Selling Price per Unit: 12.
Variable Cost per Unit:
Direct Material: 5 Direct Labour: 2
Direct Overhead 100% of Direct Labour. (100% of 2) = 2
12. Given Information:
Selling Price per Unit: ₹45
Variable Manufacturing Cost per Unit: 25
Variable Selling Cost per Unit: 5 Fixed Factory Overhead: ₹1, 50,000
Fixed Selling Cost: ₹30,000
Calculate:
(1) BEP (in units) and Sales
(2) No. of units that must be sold to earn a profit of ₹1,00,000 per year
(3) How many units are to be sold to earn a net income of 15% of sale?
13. Given Information:
Total Sales: ₹3,60,000 Selling Price per Unit: 100
Variable Cost per Unit: ₹50 Fixed Cost: 1,00,000
Calculate:
(1) P/V Ratio, BEP and Margin of Safety.
(2) If the selling price is reduced to 90 by how much is MOS reduced?
(3) What should be the sales to earn a profit of 2,50,000?
14. Assuming the Cost Structure and Selling Prices, from the following data.
Year Sales Profit
I 1,20,000 9,000
II 1,40,000 13,000
Calculate P/V Ratio, Fixed Cost, BEP for Sales, Profit when Sales are 1,50,000, Sales require
Profit of 50,000 and MOS when Profit 80,000.
