Assume that sales volume remains fixed but there is a 5% increase in variable expenses (materials cost) for the Model 101 and 301, and a 10% increase in variable expenses for Model 201. What is the new break-even?

 

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Sales Cost of goods sold: Variable Fixed Gross Margin Selling & Administrative Commissions Mirabel Manufacturing Budgeted Income Statement For the Year Ending December 31 Net Operating Income $ $ Fixed Marketing Expenses Fixed Administrative Normal Annual Sales Volume Unit Selling Price Variable expense per unit $ $ 13,300,000 9,300,000 Model 101 16,000 $ 650 250 $ $ $ es ist es es $ $ $ Model 201 19,000 $ 750 200 36,750,000 14,150,000 4,410,000 1,350,000 6,000,000 2,390,000 $ es es $ Model 301 11,000 1,100 500 Sales Cost of goods sold: Variable Fixed Gross Margin Selling & Administrative Commissions Mirabel Manufacturing Budgeted Income Statement For the Year Ending December 31 Net Operating Income $ $ Fixed Marketing Expenses Fixed Administrative Normal Annual Sales Volume Unit Selling Price Variable expense per unit $ $ 13,300,000 9,300,000 Model 101 16,000 $ 650 250 $ $ $ es ist es es $ $ $ Model 201 19,000 $ 750 200 36,750,000 14,150,000 4,410,000 1,350,000 6,000,000 2,390,000 $ es es $ Model 301 11,000 1,100 500

Answer rating: 100% (QA)

To calculate the new breakeven point we need to consider the updated variable expenses due to the in... View the full answer