CA Inter P4 · Chapter 13 · Question 1 of 10
A product sells at ₹250 per unit with a variable cost of ₹160 per unit. The P/V ratio is:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) 36%
Explanation
Contribution per unit = ₹250 - ₹160 = ₹90. P/V ratio = contribution / sales x 100 = 90 / 250 x 100 = 36%. Dividing contribution by variable cost (56.25%) is a common error.
More Marginal Costing MCQs
- Q3With break-even sales of ₹30,00,000 and a P/V ratio of 36%, actual sales for the year are ₹40,00,000. The profit for the year is:
- Q4Sales and profit of a company for two periods were: Period 1 sales ₹12,00,000, profit ₹1,10,000; Period 2 sales ₹15,00,000, profit…
- Q5Fixed costs are ₹1,78,000 and the P/V ratio is 24%. The sales required to earn a profit of ₹2,30,000 are:
- Q6Products A and B have contributions of ₹60 and ₹84 per unit respectively. Product A requires 3 machine hours per unit and B requires 6…
- Q7In a period with no opening stock, a company produced 10,000 units and sold 8,500 units. Fixed production overheads were ₹3,00,000…