b PST Limited is a cement block production company. It has developed a new cement block having higher strength, better appearance, and less selfweight. PST Limited requires a return on invested capital of per annum.
Budgeted sales volume in units units.
Variable production cost per unit Rs
Fixed production cost per unit Rs
Other annual fixed costs overheads etc. Rs
Investment in machinery to produce the new block Rs
Period over which investment in new machinery is to be written off years.
Research and development costs for the new block Rs
i Calculate the unit price of the new cement block based on the above data.
marks
