Question

question on profit and loss

Answer 1

1) An indian company purchases components X and Y fom UK and Germany respectively.
X and Y form 40% and 30% of the total production cost.Current gain 25%.
Due to change in the international exchange rate scenario
the cost of the German mark increased by 50% and that of UK pound increased by 25%.
due to tough competitive market conditions,the selling price cannot be increased beyond 10%. then

i)what is the maximum current gain?

a.10%
b.12.4%
c.0%
d.7.5%

Answer 2

@aum

Answer 3

"Current gain 25%"
What is the definition of "gain" ? Profit?

Answer 4

gain is 25
is x+25x/100

Answer 5

Assume production cost is Rs. 100.
X from UK costs Rs. 40
Y from Germany costs Rs. 30
The rest costs Rs. 30 for a total of Rs. 100 production cost.

For a 25% gain (assuming profit), the selling price is Rs. 125.

Answer 6

X from UK now costs 25% more. New cost of X is: Rs. 40 + Rs. 10 = Rs. 50.
Y from Germany now costs 50% more. New cost of Y is: Rs. 30 + Rs. 15 = Rs. 45.
The rest costs Rs. 30 as before.
Total new cost = Rs. 50 + Rs. 45 + Rs. 30 = Rs. 125

Max. increase in selling price is 10%.
New selling price = Rs. 125 + Rs. 12.5 = Rs. 137.50.

New profit = Rs. 137.50 - Rs. 125 = Rs. 12.50

Profit percentage = 12.50 / 125 * 100 = 10%.

Answer 7

@aum the value 125 ,u took from selling price

or total new cost ?

Answer 8

New Profit Percentage = Actual New Profit / New Production Cost * 100

Answer 9

ok, thnx u very much