The publishing company is publishing a book for business economics for which it has estimated the following total fixed and average variable cost: Total fixed cost $100,000 Average Variable Cost $ 20 Selling Price $ 30 a) Determine the breakeven output and total sales revenues. b) Determine the output that would generate a total profit of $ 60000 and total sales revenue at that output level. c) If total fixed cost reduced to $ 40,000 then what is the breakeven point. How much units they have to sale if they require to have a profit of $ 60,000.
The publishing company is publishing a book for business economics for which it has estimated the following total fixed and average variable cost: Total fixed cost $100,000 Average Variable Cost $ 20 Selling Price $ 30 a) Determine the breakeven output and total sales revenues. b) Determine the output that would generate a total profit of $ 60000 and total sales revenue at that output level. c) If total fixed cost reduced to $ 40,000 then what is the breakeven point. How much units they have to sale if they require to have a profit of $ 60,000.
Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter8: Cost Analysis
Section: Chapter Questions
Problem 5E
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The publishing company is publishing a book for business economics for which it has estimated the following total fixed and average variable cost:
Total fixed cost $100,000
Average Variable Cost $ 20
Selling Price $ 30
a) Determine the breakeven output and total sales revenues.
b) Determine the output that would generate a total profit of $ 60000 and total sales revenue at that output level.
c) If total fixed cost reduced to $ 40,000 then what is the breakeven point. How much units they have to sale if they require to have a profit of $ 60,000.
d) Find out the publisher breakeven point if fixed cost remain same at $ 100,000 but the variable cost reduced to $10. Also find out the breakeven point if profit of $60,000 has to be earned.
e) Find out the breakeven and sales at required profit of $60,000 if all cost remain same but the price per unit increased to $40.
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