We are here with you hands in hands to facilitate your learning & don't appreciate the idea of copying or replicating solutions. Read More>>

Looking For Something at vustudents.ning.com? Click Here to Search


+ Link For Assignments, GDBs & Online Quizzes Solution


+ Link For Past Papers, Solved MCQs, Short Notes & More

Dear Students! Share your Assignments / GDBs / Quizzes files as you receive in your LMS, So it can be discussed/solved timely. Add Discussion

How to Add New Discussion in Study Group ? Step By Step Guide Click Here.

MGT402 - Cost & Management Accounting, Assignment # 02, Opening Date Feb 1st, 2016, Due Date Feb 8th, 2016

Assignment # 02

Cost & Management Accounting (MGT402)



DUE DATE: 08th February, 2016



 Breakeven Analysis


 To understand Breakeven Analysis in terms of units, rupees and in terms of target profit. ASSIGNMENT QUESTION:

Mr. Aslam is manufacturing different home appliances including micro wave ovens in his production unit. These are information about costs and selling price of microwave oven for the month of December 2015.

Description Cost (Rs. Per unit)

Selling price 2950

Cost of raw material 800

Cost of casting process 200

Cost of milling & grinding 400

Cost of polishing 300

Cost of packaging 150

Mr. Aslam also incur Salaries of workers, factory rent and other fixed costs Rs , 1.2, 1.6 and 0.4 million respectively during the month.

Required: Based on the above information of Mr. Aslam’s business, you are required to calculate:

1. Breakeven Point in unit of “microwave ovens” and in rupees for the period. (04 marks)

2. Amount of sales for Target Profit of Rs 1.2 million (02marks)

3. At present, production unit is selling 3,000 microwave ovens per month. Marketing department is convinced that a 16% reduction in the selling price will result in a 30 % increase in the number of microwave oven sold each month. What will be impact on Net Operating Income at present plan and proposed plan by marketing department? Is this change is suitable for production unit? (04 marks)

IMPORTANT: Grace period of extra 24 hours after the due date is usually available to overcome uploading difficulties. This extra time should only be used to meet the emergencies and above mentioned due dates should always be treated as final to avoid any inconvenience. IMPORTANT INSTRUCTIONS

 Take help from internet for collecting the information.

 Carefully watch relevant lectures and consult the relevant material from handouts along with recommended books.

 Attempt the assignment by yourself and it will be entertained positively.



 Make sure to upload the solution file before the due date on VULMS.

 Any submission made via email after the due date will not be accepted. FORMATTING GUIDELINES:

 Use the font style “Times New Roman” or “Arial” and font size “12”.

 It is advised to compose your document in MS-Word format.

 You may also compose your assignment in Open Office format.

 Use black and blue font colors only.

RULES FOR MARKING Please note that your assignment will not be graded or graded as Zero (0), if:

 It is submitted after the due date.

 The file you uploaded does not open or is corrupt.

 It is in any format other than MS-Word or Open Office; e.g. Excel, PowerPoint, PDF etc.

 It is cheated or copied from other students, internet, books, journals etc.

Note related to load shedding: Please be proactive Dear students! As you know that Post Mid-Term semester activities have been started and load shedding problem is also prevailing in our country now a days.

Keeping in view the fact, you all are advised to post your activities as early as possible without waiting for the due date.

For your convenience; activity schedule has already been uploaded on VULMS for the current semester, therefore no excuse will be entertained after due date of assignments, quizzes or GDBs.


+ How to Follow the New Added Discussions at Your Mail Address?

+ How to Join Subject Study Groups & Get Helping Material?

+ How to become Top Reputation, Angels, Intellectual, Featured Members & Moderators?

+ VU Students Reserves The Right to Delete Your Profile, If?

See Your Saved Posts Timeline

Views: 6347


+ http://bit.ly/vucodes (Link for Assignments, GDBs & Online Quizzes Solution)

+ http://bit.ly/papersvu (Link for Past Papers, Solved MCQs, Short Notes & More)

+ Click Here to Search (Looking For something at vustudents.ning.com?)

+ Click Here To Join (Our facebook study Group)

Replies to This Discussion

Breakeven Point Sales (Rupees) = Breakeven Point (Units) * Selling Price

             =     2909 X 2950

            =       85, 81,818 Rs.

Part 1 may is calculation ki need hai ? 

Adash ye formula mene part 2 me kaha tha use krne klye

BE in Rs. = BE (Units) x selling price per unit

Aur ap sb apne ans ko millions me convert kro tu sbka sahi ayega. jaise ye answer bi theek hai 8581818 lekn round off kro 8.6 million

For part 2 .

I think part 2 ka yay Ans sahi hai.

Target CM =  Target Profit + Fixed Cost = 1.2 million + 3.2 million = 4.4 million

Sales in Units =   Target CM / CM per Unit = 4.4 million / 1100 = 4000 Units


Sales in Rs. = Selling price per unit x No. of units = 2950 x 4000 = 11800000


han part 2 ka yehi ans hai bint e ahmad. aur part 3 me net profit 100,000 aur net loss 750,800 hai.

aur loss ko 2 ways se likhte hen 1. loss = 750,800 or 2. profit = (750,800). thats accounting rule.

jazak Allah maham , i understand..

CM = 1100 aur C/S ratio = 0.37

they both are different things dont confuse yourself.

aur part 1 ka answer round off krke 8.6 million likhdo






1.     Breakeven Point in Units and Sales.

Break even Points Sales (Units) = Fixed Cost/Selling Price-Variable cost

                                 = 12, 00,000+ 16,00,000+ 400,000 / 2,950- 1,850

                                 =      32,00,000 / 1,100

                                 =      2,909. Units

            Breakeven Point Sales (Rupees) = Breakeven Point (Units) * Selling Price

                                             =   2909 X 2950

                                             =   Rs. 85,81,818

2.           Amount of Sales = Profit + Fixed Cost / Contribution Margin 

                                         = 12,00,000 + 32,00,000 / 37.29%

                                         = Rs. 18,000,000

            Sales in Units = Amount of Sales / Selling Price

                                   = 18,000,000 / 2950

                                   = 4000 units



Contribution Margin  = Selling Price – Variable Cost / Selling Price x 100

                                  = 2950 – 1850 / 2950 x 100

                                  =   37.29 %

3.   Sales Budget = Selling Price x Units

                                       = 2950 x 3000

                                       = Rs. 88, 50,000


  Proposed selling price per Unit = Selling Price – (Selling Price x 16 %)

                           = 2950 – (2950 x 16 %)

                           = 2950 - 472




  Proposed selling price = Rs. 2478 per unit

  Value of proposed units by increasing the Actual output of Units

                           = Selling Price + (Selling Price x 30%)

                           = 3000 + (3000 x 30%)

                          = 3900  units

Net Income

At Present Plan



Sales                                                                                           88, 50,000                   

(Selling Price x Units)                                             

 (2950 x 3000)                               

Less: Variable Cost                                                                         55, 50,000

      (Variable Cost x units)

      (1850 x 3000)

Contribution Margin                                                                       33, 00,000

Less: Fixed Cost                                                                             32, 00, 000

Net Profit                                                                                        100,000





Net Income

At Proposed Plan


Sales                                                                                                             96, 64,200

(Proposed Selling Price x Proposed units)

(2478 x 3900)

 Less: Variable Cost                                                                                    72, 15,000

(Variable cost x proposed units)

(1850 x 3900)

Contribution Margin                                                                                   24, 49,200

Less: Fixed Cost                                                                                         32, 00,000

Net Loss                                                                                                      ( 750,000)


So, In this case change is not suitable for production department because at present plan they are earning profit by Rs. 100,000.

assignment mgt402 solution 2 

correct solution of mgt402



© 2019   Created by + M.Tariq Malik.   Powered by

Promote Us  |  Report an Issue  |  Privacy Policy  |  Terms of Service