XYZ, inc. makes and sells bicycle parts. Last year XYZ sold 5,300 handlebars, generating sales of...

 

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XYZ, inc. makes and sells bicycle parts. Last year XYZ sold 5,300 handlebars, generating sales of $110,000. This year they are considering a new pricing strategy with a target profit goal of $11,000. They determined that for every $3 increase to the selling price, a 200 decrease in unit sales was expected. Their total costs were $100,000 with fixed costs accounting for $65,000. This year, XYZ, inc. is considering changing the selling price to $27. What is the breakeven volume for XYZ? XYZ, inc. makes and sells bicycle parts. Last year XYZ sold 5,300 handlebars, generating sales of $110,000. This year they are considering a new pricing strategy with a target profit goal of $11,000. They determined that for every $3 increase to the selling price, a 200 decrease in unit sales was expected. Their total costs were $100,000 with fixed costs accounting for $65,000. This year, XYZ, inc. is considering changing the selling price to $27. What is the breakeven volume for XYZ?

Answer rating: 100% (QA)

To find the breakeven volume for XYZ we need to determine the level of sales in units at which the t... View the full answer