Rs. 1,00,000
Rs. 75,000
Rs. 55,000
Rs. 20,000
Answer is Right!
Answer is Wrong!
The correct answer is A. Rs. 1,00,000.
The margin of safety is the amount of sales that a company can lose before it starts to incur a loss. It is calculated by subtracting the break-even point from the sales. The break-even point is the point at which a company’s revenue equals its costs.
In this case, the margin of safety is Rs. 80,000. This means that the company can lose Rs. 80,000 in sales before it starts to incur a loss. The profit is Rs. 20,000. This means that the company is making a profit of Rs. 20,000 on every Rs. 3,00,000 in sales.
To calculate the fixed cost, we can use the following formula:
Fixed cost = (Sales – Variable cost – Profit) / Margin of safety
In this case, the fixed cost is:
Fixed cost
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