tetnictic Sports, Inc, produces high-quality sports cquipment. The company\'s Ra

Question

tetnictic Sports, Inc, produces high-quality sports cquipment. The company's Racket Division manufactures two rackets is given below ts -the Standard and the Deluxe that are widely used in amateur play. Selected information on the Deluxe Standard $47.70 84.00 Selling price per racket Variable expenscs per rackct: Production Sales commission (5% of price) $ 21.40 S 28.10 5.50 2.45 $ Sales in units over the past two months have been as follows April May Standard 5,000 4,000 Deluxe 3,000 3,500 All sales are made thro ugh the company's own retail outlets. The Racket Division has the following fixed costs: Fixed production costs Advertising expense Administrative salaries Per Month 107,000 101,000 50,000 258,000 Total Compute the Racket Division's break-even point in dollar sales for April. A. 460, 185 B. S C. 467,920 D. S 469,091 $ 430,000 Standand beluxe E. S 516,000 Sales Tox 000 23500 13800 25200 vailable. 24.105000: {DUD 2d-lo1 300034300 Saes 23255000'll425 423000 sliboo 14515 55100 -274b15 CM 214615 2140500

Explanation / Answer

bep in units = fixed cost / contribution margin

bep in units = 258000 / ( 47.70 - (21.40 + 2.45) ) = 10817.61

10817.61 * unit selling price 47.70 = 516000

so answer is E $516000

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