Q.

If the P/V Ratio of a product is 30% and selling price is Rs. 25 per unit, the marginal cost of the product would be .

A. Rs. 18.75
B. Rs. 16.50
C. Rs. 15.40
D. Rs. 17.50
Answer» D. Rs. 17.50
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Cost and Management Accounting (CMA)

Discussion

Konain Raza
1 year ago

First, let's find the Contribution:
Contribution = P/V Ratio × Selling Price
Contribution = P/V Ratio × Selling Price
Contribution = 0.30 × 25
Contribution = 0.30 × 25
Contribution = 𝑅𝑠.7.50
The Contribution per unit is the difference between the Selling Price and the Marginal Cost:
Contribution = Selling Price − Marginal Cost
7.50 = 25 − Marginal Cost
Solving for the Marginal Cost:
Marginal Cost = 25 − 7.50
Marginal Cost = 25 − 7.50
Marginal Cost= 𝑅𝑠.17.50

Please note that given options are wrong.
1

McqMate
1 year ago

I have fixed the option.
Thank you for pointing it out.
1
Y

Yash
3 years ago

Detail
0

Sameer Ul Rehman
3 years ago

Give me the solution of that question
0

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