Fancy Bag company purchases Ladies Bags from a wholesaler @

Fancy Bag company purchases Ladies Bags from a wholesaler @ Rs 1100/-

per piece. They add accessories and packaging and sell each bag for Rs 1800/- per piece. They incur certain fixed expenses. The company wants to understand how many pieces they must sell in order to be profitable. They seek the help of a Management accountant to:

a. Ascertain Contribution per piece and as a % of Sales Price           

b. Prepare the Profit / Loss account for sale of 200 pieces 300 pieces Details provided:

Purchase Cost 1100 per pc  Sale 1800 per pc  Expenses  Per Month Rent  50000  Staff Salary 75000  Commission per pc 100