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A dealer mixes a tea costing rs 6.92 per?
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A dealer mixes a tea costing rs 6.92 per?
Explanation of Mixing Tea


Mixing tea involves combining different types of tea in order to create a new blend that has a unique taste and aroma. This process is commonly used by tea dealers in order to provide their customers with a wider range of tea options and to increase their profit margins.


Calculating the Cost of Mixing Tea


In order to calculate the cost of mixing tea, the dealer must first determine the cost of each type of tea that will be used in the blend. This can be done by dividing the total cost of each type of tea by the total weight of that tea.



  • For example, if the dealer uses 1 kg of tea that costs Rs 5.50 per kg and 2 kg of tea that costs Rs 7.50 per kg, the total cost of the tea would be :

  • (1 x 5.50) + (2 x 7.50) = Rs 20.50

  • The total weight of the tea would be 1 + 2 = 3 kg



The cost per kg of tea would be :



  • 20.50 / 3 = Rs 6.83



This means that the dealer would need to sell the mixed tea at a price higher than Rs 6.83 per kg in order to make a profit.


Factors Affecting the Cost of Mixing Tea


The cost of mixing tea can be affected by a number of factors, including :



  • The cost of the individual types of tea that are used in the blend

  • The proportion of each type of tea that is used in the blend

  • The cost of packaging and marketing the mixed tea

  • The competition in the market



By carefully considering these factors, a tea dealer can create a high-quality blend of tea that is both profitable and appealing to customers.
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Similar CA Foundation Doubts

Pawan sent on consignment to Raman, 10 cases of tea costing Rs. 5,000 each invoiced proforma at Rs. 6000 each. Freight and other charges on the consignment amounted to Rs. 3,100. On 31st March, 1996, Raman sent an accounts sales showing that 4 cases had been sold at Rs. 6,000 each and 3 cases at Rs. 7,000 each while 3 cases remained unsold. Raman also informed Pawan that of the three cases remaining in stock, two cases were badly damaged due to bad packing and that they would be sold at Rs. 3,000 per caseRaman was entitled to a commission of 5% on gross sales which included del credere commission. Raman could recover Rs. 4,000 only from a customer to whom one case had been sold on credit for Rs. 6,000. Amount of all other sales were duly received. On 31st March, 1999, Raman paid the amount due to Pawan by means of a cheque. Prepare the ledger accounts in the books of Pawan. Related: ICAI Notes 7.2 - Consignment Accounting (Part - 1)?

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A dealer mixes a tea costing rs 6.92 per?
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A dealer mixes a tea costing rs 6.92 per? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about A dealer mixes a tea costing rs 6.92 per? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for A dealer mixes a tea costing rs 6.92 per?.
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