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A manufacturer has the following data regarding a product: Fixed cost per month = Rs. 50000 Variable cost per unit = Rs. 200 Selling price per unit = Rs. 300 Production capacity = 1500 units per month .If the production is carried out at 80% of the rated capacity, then the monthly profit (in Rs.) is___.
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- Rs. 70,000
- Rs. 69,000
- Rs. 71,000
- Rs. 75,000
Correct Option: A
Fixed Cost (Fl) = Rs 50000
Variable Cost = Rs 200
Selling price/unit = Rs 300
Production Capacity = 1500 unit per month
At 80% Rated capacity the production is = 0.80 × 1500 = 1200 unit/month
Total cost = FC + Variable cost = 50000 + 1200 × 200 ⇒ 290000
Profit = Sales – Total Cost
= 3,60,000 – 2,90,000
⇒ Rs 70,000
