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    Question

    Refer to the following information to answer the next 4 questions (Q5 to Q8) Deepak Ltd produces and sells two products – shirts and trousers. The details of the 2 products are as under: Product T-Shirt Shirt Sales price per unit Rs.800 Rs.1400 Variable Cost per unit Rs.380 Rs.420 Deepak Ltd’s fixed costs are Rs.43,89,000 per period.

    In the above product mix, how many shirts should be sold

    by Deepak Ltd to break even?
    A 3250 Correct Answer Incorrect Answer
    B 3300 Correct Answer Incorrect Answer
    C 3325 Correct Answer Incorrect Answer
    D 3225 Correct Answer Incorrect Answer
    E 3200 Correct Answer Incorrect Answer

    Solution

    Break even = fixed cost/contribution In the given product mix, break even = fixed cost/contribution = Rs.43,89,000/7980 = 550 mixes Shirts in the mix = 6 Total shirts required = 6*550 = 3300 shirts

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