A furniture manufacturer specializes in wood tables. The tables sell for $80 and
ID: 2553808 • Letter: A
Question
A furniture manufacturer specializes in wood tables. The tables sell for $80 and incur $28 per unit in variable costs. The company has $3,885 in fixed costs per month. Calculate the breakeven point in units under each independent scenario. 14. Variable costs increase by $15 per unit. 15. Fixed costs decrease by $505. 16, Sales price increases by 20%. Begin by selecting the formula labels. Then enter the amounts to compute the number of wood tables the company must sell to break even under each independent scenario, beginning with scenario 14. (Abbreviation used: CM contribution margin. Complete all answer boxes. For items with a zero value, enter "O". Round the breakeven point-the required sales in units-up to the nearest whole unit. For example, 10.25 would be rounded to 11.) )1 Required sales in units = 14. 15.( 16. (Explanation / Answer
Breakeven point in units = Fixed costs / Contribution margin per unit
14.
Selling price per unit = 80
Variable cost per unit = 28 + 15 = 43
Contribution margin per unit = Selling price per unit - Variable costs per unit
= 80 - 43 = 37
Fixed costs = 3,885
Breakeven point = 3,885/37 = 105 units
15.
Selling price per unit = 80
Variable cost per unit = 28
Contribution margin per unit = Selling price per unit - Variable costs per unit
= 80 - 28 = 52
Fixed costs = 3,885 - 505 = 3,380
Breakeven point = 3,380 / 52 = 65 units
16.
Selling price per unit = 80 + 16 = 96
Variable cost per unit = 28
Contribution margin per unit = Selling price per unit - Variable costs per unit
= 96 - 28 = 68
Fixed costs = 3,885
Breakeven point = 3,885 / 68 = 58 units
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