A producer of pottery is considering the addition of a new plant to absorb the b

Question

A producer of pottery is considering the addition of a new plant to absorb the backlog of demand that now exists. The primary location being considered will have fixed costs of $11, 200 per month and variable costs of $0.73 per unit produced. Each item is sold to retailers at a price that averages $0.93 a) The volume per month is required in order to break even = b) The profit or loss would be realized on a monthly volume of 61.000 units = c) The volume is needed to obtain a profit of $ 16.000 per month = d) The volume is needed to provide revenue of $23.000 per month =

Explanation / Answer

ANS:- A- 56000 [11200/(0.93-0.73)]

         B- Profit

         C-136000

        D-115000

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