The current situation of ABC company is as follows: Variable costs are 82% of sales and fixed costs are $44 000. a) A suggestion is made to improve the profit by increasing the contribution margin. If the contribution margin can be improved by 5% of sales by increasing fixed costs by $10 000, will the break even point be lower? b) If sales are currently $300 000, will the profit be better, assuming no increase in sales?

The current situation of ABC company is as follows: Variable costs are 82% of sales and fixed costs are $44 000. a) A suggestion is made to improve the profit by increasing the contribution margin. If the contribution margin can be improved by 5% of sales by increasing fixed costs by $10 000, will the break even point be lower? b) If sales are currently $300 000, will the profit be better, assuming no increase in sales?

Name: The current situation of ABC company is as follows:Variable costs are
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Description: The current situation of ABC company is as follows:Variable costs are 82% of sales and fixed costs are $44 000.a) A suggestion is made to improve the profit by increasing the contribution margin. If thecontribution margin can be improved by 5% of sa

Linear Algebra: A Modern Introduction

4th Edition

ISBN:9781285463247

Author:David Poole

Publisher:David Poole

Chapter2: Systems Of Linear Equations

Section2.4: Applications

Problem 26EQ

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