Fixed cost ₹80,000, contribution per unit ₹20. Break-even units:
A3,000
B5,000
C4,000
D2,000
Answer & Solution
Correct answer: C. 4,000
1. BEP units = Fixed cost / Contribution per unit.
2. Substitute: 80,000 / 20.
3. = 4,000 units.
4. Below this volume the firm is in loss; above, profit emerges.
_Source: ICAI BoS Inter Paper 3, Ch 14 "Marginal Costing", §14.5 Illus 5_
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