Question: Benoit Inc. had $150,000 of profit in 2017 when the selling price per unit were $150, the variable costs per unit were $90, and the

Benoit Inc. had $150,000 of profit in 2017 when the selling price per unit were $150, the variable costs per unit were $90, and the fixed costs were $750,000. Management expects per unit date and total fixed costs to remain the same in 2018. The president of Benoit is under Pressure from shareholders to increase Profit by $90,000 in 2018.

Instructions

(a) Calculate the number of units sold in 2017.

(b) Calculate the number of units that would have to be sold in 2018 to reach the shareholders’ desired profit level.

(c) Assume that Benoit Inc. sells the same number of units in 2018 as it did in 2017, What would the selling price have to be in order to reach the shareholders’ desired profit level?

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Lets tackle the problem step by step Known Information Selling price per unit SP 150 Variable cost per unit VC 90 Fixed costs FC 750000 Profit in 2017 ... View full answer

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