Question

Omar Corporation manufactures faucets. The variable costs of production are $37 per faucet. Fixed costs of production are $876,000. Omar sells the faucets for a price of $61 per unit.

Required
a. How many faucets must Omar make and sell to break even?
b. How many faucets must Omar make and sell to earn a $225,000 profit?
c. The marketing manager believes that sales would increase dramatically if the price were reduced to $57 per unit. How many faucets must Omar make and sell to earn a $225,000 profit, assuming the sales price is set at $57 per unit?



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  • CreatedFebruary 07, 2014
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