A manufacturing business that is involved in manufacturing and selling a single product. The annual fixed expenses to run the business are $15000 and variable expenses are $7.50 per unit. The sale price of your product is $15 per unit. A. Formulate the total revenue, total cost, and profit B. Find the break-even point quantity and revenue. C. Find the number of units to sell if the estimated profit is $50,000
A manufacturing business that is involved in manufacturing and selling a single product. The annual fixed expenses to run the business are $15000 and variable expenses are $7.50 per unit. The sale price of your product is $15 per unit. A. Formulate the total revenue, total cost, and profit B. Find the break-even point quantity and revenue. C. Find the number of units to sell if the estimated profit is $50,000
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 8SQP
Related questions
Question
Break even point analysis
1. A manufacturing business that is involved in manufacturing and selling a single product. The annual fixed expenses to run the business are $15000 and variable expenses are $7.50 per unit. The sale price of your product is $15 per unit.
A. Formulate the total revenue, total cost, and profit
B. Find the break-even point quantity and revenue.
C. Find the number of units to sell if the estimated profit is $50,000
D. Find the total profit if the total units sold is 5000 units.
E. Find the units to sell to break-even the fixed expenses.
2. It costs a publishing company 50,000 dollars to make books. The 50,000 is a fixed cost or cost that cannot change. To help the publishing company sell the books, how many books should they sell to break even?
3. A manufacturing company supplies its products to construction job sites. The average monthly fixed cost pee site is $4,500, while each unit cost $35 to produce and selling price is $50 per unit.Determine the monthly break even volume.
4. A store sell t-shirts.The average selling price is $15 and the average variable cost (cost price) is $9. Thus, every time the store sells a shirt it has $6 remaining after it pays the manufacturer. This $6 is referred to as the unit contribution.
A. Suppose the fixed costs of operating the store (its operating expenses) are $ 100,000 per year. Find the break even in units?
B. If the owner desired a profit of $25000, what will be break even point in dollars?
C. If fixed costs rose to $110000, break even in units volume would be?
D. If the average selling price rose to $16, break even volume would fall?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning
Managerial Economics: A Problem Solving Approach
Economics
ISBN:
9781337106665
Author:
Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:
Cengage Learning