Dar al-Salam Company publishes Creative Crosswords. Last year the book of puzzles sold for US$10 with variable
Question:
Dar al-Salam Company publishes Creative Crosswords. Last year the book of puzzles sold for US$10 with variable operating costs per book of US$8 and fixed operating costs of US$40,000. How many books must Dar al-Salam sell this year to achieve the breakeven point for the stated operating costs, given the following different circumstances?
a. All figures remain the same as for last year.
b. Fixed operating costs increase to US$44,000; all other figures remain the same.
c. The selling price increases to US$10.50; all costs remain the same as for last year.
d. Variable operating cost per book increases to US$8.50; all other figures remain the same.
e. What conclusions about the operating breakeven point can be drawn from your answers?
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Breakeven pointchanging costsrevenues a Q F P V C Q 40000 10 8 20000 books b Q 44000 ...View the full answer
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Saikumar Ramagiri
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