A) Determine the number of widgets (units) which must be sold to break even. B)
ID: 2372396 • Letter: A
Question
A)
Determine the number of widgets (units) which must be sold to break even.
B)
Determine the breakeven point in dollars
C)
How many additional widgets must be sold to realize a target profit of $ 100,000?
D)
IF DS Inc raises the selling price to $ 35 and variable cost per unit increases
by 10% what is the new breakeven point in units
E)
Assume the original facts and that DS will sell enough units to breakeven.
Should DS spend $ 10,000 on an advertising program that will result in
1200 additional sales. Be specific and show the exact amount of profit or loss.
A)
Determine the number of widgets (units) which must be sold to break even.
B)
Determine the breakeven point in dollars
C)
How many additional widgets must be sold to realize a target profit of $ 100,000?
D)
IF DS Inc raises the selling price to $ 35 and variable cost per unit increases
by 10% what is the new breakeven point in units
E)
Assume the original facts and that DS will sell enough units to breakeven.
Should DS spend $ 10,000 on an advertising program that will result in
1200 additional sales. Be specific and show the exact amount of profit or loss.
Can you understand this copy and pasteExplanation / Answer
DS Inc sells widgets for $ 32.00 per unit. The variable cost per unit is $ 25.00. If the total fixed cost is $ 335,000, compute the following:
A) Determine the number of widgets (units) which must be sold to break even.
number of widgets (units) =335000/(32-25) =47857.14 = 47858 unit
B)
Determine the breakeven point in dollars
Break even point in dollars = 47858*32 = $1,531,456
C)
How many additional widgets must be sold to realize a target profit of $ 100,000?
Additional Widget = 100,000/7 = 14285 unit
D)
IF DS Inc raises the selling price to $ 35 and variable cost per unit increases
by 10% what is the new breakeven point in units
New Break Even point = 335000/(35-27.5) = 44,666.66 44,667 unit
E)
Assume the original facts and that DS will sell enough units to breakeven.
Should DS spend $ 10,000 on an advertising program that will result in
1200 additional sales. Be specific and show the exact amount of profit or loss.
Contribution increase from additional sale = 1200*7 = $8400
new additional advertisement cost = $10000
loss =$1600
DS should not spend on advertisement program
A) Determine the number of widgets (units) which must be sold to break even.
number of widgets (units) =335000/(32-25) =47857.14 = 47858 unit
B)
Determine the breakeven point in dollars
Break even point in dollars = 47858*32 = $1,531,456
C)
How many additional widgets must be sold to realize a target profit of $ 100,000?
Additional Widget = 100,000/7 = 14285 unit
D)
IF DS Inc raises the selling price to $ 35 and variable cost per unit increases
by 10% what is the new breakeven point in units
New Break Even point = 335000/(35-27.5) = 44,666.66 44,667 unit
E)
Assume the original facts and that DS will sell enough units to breakeven.
Should DS spend $ 10,000 on an advertising program that will result in
1200 additional sales. Be specific and show the exact amount of profit or loss.
Contribution increase from additional sale = 1200*7 = $8400
new additional advertisement cost = $10000
loss =$1600
DS should not spend on advertisement program
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