1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?
1. A company is considering opening a new product line. The building being considered will have a monthly lease and utility payment of $3500. Two employees will be hired at $ 15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit product sold is estimated at $ 100. The variable cost of production of each unit is estimated at $40. a) How many units must be produced each month for the buisness to breakeven? b) How many units must be produced monthly to achieve a monthly profit of $10,000?
Chapter6: Proudction Costs
Section: Chapter Questions
Problem 8SQP
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Please answer question with details on how to do it. Thank you.
![1. A company is considering opening a new product line. The building being considered will
have a monthly lease and utility payment of $3500. Two employees will be hired at $
15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit
product sold is estimated at $ 100. The variable cost of production of each unit is
estimated at $40.
a) How many units must be produced each month for the buisness to breakeven?
b) How many units must be produced monthly to achieve a monthly profit of $10,000?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F1296c196-158c-4a2c-9587-82b5996e9fed%2F5324b51e-ddb0-47be-b635-f925a1aa5507%2F371kuk9_processed.jpeg&w=3840&q=75)
Transcribed Image Text:1. A company is considering opening a new product line. The building being considered will
have a monthly lease and utility payment of $3500. Two employees will be hired at $
15/hr/employee. Each employee will work 120 hrs per month. The average revenue per unit
product sold is estimated at $ 100. The variable cost of production of each unit is
estimated at $40.
a) How many units must be produced each month for the buisness to breakeven?
b) How many units must be produced monthly to achieve a monthly profit of $10,000?
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