A meeting of the heads of departments of the Arnav Ltd. has been called to review the operating performance of the company in the last financial…

A meeting of the heads of departments of the Arnav Ltd. has been called to review the operating performance of the company in the last financial year. The head of the production department appraised that during the last year the company could operate at 70% capacity level but in the coming financial year 95% capacity level can be achieved if an additional amount of 100 Crore on capex and working capital is incurred. The head of the finance department has presented that during the last financial year the company had a P/V ratio of 40%, margin of safety and the break-even were 50 crore and 200 crore respectively. To the reply to the proposal of increasing the production capacity level to 95%, the head of the finance department has informed that this could be achieved if the selling price and variable cost are reduced by 8% and 5% of sales respectively. Fixed cost will also increase by 20 crore due to increased depreciation on additional assets. The additional capital will be arranged at a cost of 15% p.a. from a bank. In the coming financial year, it has been aimed to achieve an additional profit of 10 crore over and above the last year's profit after adjusting the interest cost on the additional capital. The following points is required to be calculated on urgent basis to put the same in the meeting. You being an assistant to the head of finance, has been asked the followings: