Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be $160,000. Variable production and material costs are estimated to be $6 per book. The publisher plans to sell the text to college and university bookstores for $46 each. 1. What is the breakeven point? 2. What profit or loss can be anticipated with a demand of 3800 copies? 3. With a demand of 3800 copies, what is the minimum price per copy that the publisher must charge to break even? 4. If the publisher believes that the price per copy could be increased to $50.95 and not affect the anticipated demand of 3800 copies, what action would you recommend?What profit or loss can be anticipated?
Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design,
and production setup is estimated to be $160,000. Variable production and material costs
are estimated to be $6 per book. The publisher plans to sell the text to college and university
bookstores for $46 each.
1. What is the breakeven point?
2. What profit or loss can be anticipated with a demand of 3800 copies?
3. With a demand of 3800 copies, what is the minimum
4. If the publisher believes that the price per copy could be increased to $50.95 and not affect the anticipated demand of 3800 copies, what action would you recommend?What profit or loss can be anticipated?
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