There are two similar plants under the same management. The management desires to merge these two plants. The following particulars are available: Details Plant-I Plant-II Capacity operation 100% 60% (in lakh) (in lakh)
CS Executive · Cost and Management Accounting · PYQS · June 2016
There are two similar plants under the same management. The management desires to merge these two plants. The following particulars are available: Details Plant-I Plant-II Capacity operation 100% 60% (in lakh) (in lakh) Sales 600 240 Variable costs 440 180 Fixed costs 80 40 The capacity of the merged plant to be operated for the purpose of break-even will be —
Answer & Explanation:
Correct Answer: Option (D)
Official answer key: (D).
Topics: Marginal Costing
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