"Following information is available of XYZ Limited for quarter ended June, 20XX
Fixed cost Rs 5,00,000
Variable cost Rs 10 per unit
Selling price Rs 15 per unit
Output level 1,50,000 units
What will be amount of profit earned during the quarter using the marginal costing technique?"
A. Rs 2,50,000
B. Rs 10,00,000
C. Rs 5,00,000
D. Rs 17,50,000
Answer: Option A
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Related Questions on Costing
Basic objective of cost accounting is ________
A. tax compliance.
B. financial audit.
C. cost ascertainment.
D. profit analysis.
Process costing is suitable for ________.
A. hospitals
B. oil refing firms
C. transport firms
D. brick laying firms
The cost which is to be incurred even when a business unit is closed is a _____.
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Sales - VC -FC = ( 1,50,000 x15) - (1,50,000x10)- 5,00,000 = 2,50,000
Cost = 50,000+ (10×1,50,000) {fixed + variable}
=2,00,000
SP= 15×1,50,000
=22,50,000
Profit = SP- COST = 2,50,000