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5 Pleasant Cold Limited manufactured and sold 1,000 refri. gerators in the year ending 31st...

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5 Pleasant Cold Limited manufactured and sold 1,000 refri. gerators in the year ending 31st March, 1979. The summarised Trading and Profit and Loss A/c is set out below: Rs. Rs. .To Cost of materials 80,000 By Sales 4,00,000 To Direct wages 1,20,000 To Manufacturing expenses 50,000 To Gross Profit c/d 1,50,000 4,00,000 4,00,000 To Management and Staff By Gross Profit bla 1,50,000 Salaries 60,000 To Rent, Rates, Insurance 10,000 To Selling expenses 30,000 To General expenses 20,000 To Net Profit 30,000 1,50,000 1,50,000 For the year ending 31st March, 1980 it is estimated that- (1) Output and sales will be 1,200 refrigerators (2) Prices of new materials will rise by 20% on the previous year's level (3) Wages rates will rise by 5%. (4) Manufacturing cost will rise in proportion to the combin. ed cost of materials and wages. (5) Selling costs per unit will remain unchanged. (6) Other expenses will remain unaffected by the rise in output. You are required to submit a statement for the Board of Directors showing the price at which the refrigerators should be marketed so as to show a profit of 10% on selling price

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