Data Interpretation Logical Reasoning (Part 7 of 7)

Doorsteptutor material for CMAT is prepared by world's top subject experts: get questions, notes, tests, video lectures and more- for all subjects of CMAT.

Directions: Answer these questions on the basis of the information given below:

The following table shows the break-up of actual costs incurred by a company in last five years (year 2002 to year 2006) to produce a particular product:

YearYear 2002Year 2003Year 2004Year 2005Year 2006
Volume of production and sale (units)Volume 1000Volume 900Volume 1100Volume 1200Volume 1200
Cost in ₹BelowBelowBelowBelowBelow
Material₹ 50,000₹ 45,100₹ 55,200₹ 59,900₹ 60,000
Labour₹ 20,000₹ 18,000₹ 22,100₹ 24,150₹ 24,000
Consumables₹ 2,000₹ 2,200₹ 1,800₹ 1,600₹ 1,400
Rent of building₹ 1,000₹ 1,000₹ 1,100₹ 1,100₹ 1,200
Rates and taxes₹ 400₹ 400₹ 400₹ 400₹ 400
Repair and maintenance expenses₹ 800₹ 820₹ 780₹ 790₹ 800
Operating cost of machines₹ 30,000₹ 27,000₹ 33,500₹ 36,020₹ 36,000
Selling and marketing expenses₹ 5,750₹ 5,800₹ 5,800₹ 5,750₹ 5,800

The production capacity of the company is 2000 units. The selling price for the year 2006 was ₹ 125 per unit. Some costs change almost in direct proportion to the change in volume of production, while others do not follow any obvious pattern of change with respect to the volume of production and hence are considered fixed. Using the information provided for the year 2006 asthe basis for projecting the figures for the year 2007, answer the following questions:

  1. What is the approximate cost per unit in rupees, ifthe company produces and sells 1400 units in the year 2007?
    1. Cost 104
    2. Cost 107
    3. Cost 110
    4. Cost 115
    5. Cost 116
  2. What is the minimum number of units that the company needs to produce and sell to avoid any loss?
    1. Units 313
    2. Units 350
    3. Units 384
    4. Units 747
    5. Units 928
  3. Given that the company cannot sell more than 1700 units, and it will have to reduce the price by ₹ 5 for all units, if it wants to sell more than 1400 units, what is the maximum profit, in rupees, that the company can earn?
    1. 25,400
    2. 24,400
    3. 31,400
    4. 32,900
    5. 32,000
  4. If the company reduces the price by 5 % , it can produce and sell as many units as it desires. How many units the company should produce to maximize its profit?
    1. Units 1400
    2. Units 1600
    3. Units 1800
    4. Units 1900
    5. Units 2000

Developed by: