Compute break- even point and profit/volume ratio from the following information's. A Company budgets for a production of 600,000 units. The variable cost per unit is $56 and fixed cost per unit is $8 per unit. The company fixes the selling price to fetch a profit of 15% on cost. Required. a) Calculate the break- even point? b) Calculate the profit/volume ratio? c) If the selling price is reduced by 5%, how does the revised selling price affects the Break Even Point.

Compute break- even point and profit/volume ratio from the following information's. A Company budgets for a production of 600,000 units. The variable cost per unit is $56 and fixed cost per unit is $8 per unit. The company fixes the selling price to fetch a profit of 15% on cost. Required. a) Calculate the break- even point? b) Calculate the profit/volume ratio? c) If the selling price is reduced by 5%, how does the revised selling price affects the Break Even Point.

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 8E: The sales price per unit is 13 for the Voyageur Companys only product. The variable cost per unit is...

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