Kitchenware, Inc., sells two types of water pitchers, plastic and glass. Plastic pitchers cost the company$15 and are sold for $30. Glass pitchers cost $24 and are sold for $45. All other costs are fixed at $982,800 per year. Current sales plans call for 14,000 plastic pitchers and 42,000 glass pitchers to be sold in the coming year.
a. How many pitchers of each type must be sold to break even in the coming year?
b. Kitchenware, Inc., has just received a sales catalog from a new supplier that is offering plastic pitchers for $13. What would be the new breakeven point if managers switched to the new supplier?