The ratio of variable cost to sales is 75%. The break-even point occurs at 64% of the capacity sales when fixed cost is ₹1,20,000. The 100% capacity sales will be —

CS Executive · Cost and Management Accounting · PYQS · June 2016
The ratio of variable cost to sales is 75%. The break-even point occurs at 64% of the capacity sales when fixed cost is ₹1,20,000. The 100% capacity sales will be —
(A) ₹4,80,000
(B) ₹2,50,000
(C) ₹7,50,000
(D) None of the above.

Answer & Explanation:

Correct Answer: Option (C)

Official answer key: (C).

Topics: Marginal Costing

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