Question: . A company making shirts is evaluating whether it is currently operating at a profit or at a loss. The company is producing 32,000 shirts.

. A company making shirts is evaluating whether it is currently operating at a profit or at a loss. The company is producing 32,000 shirts. The shirts are selling for $ 35.00 per unit; and the fixed cost is $ 500,000. In addition, the variable cost per unit is $ 25. Based on this information, which of the following statements is correct?

  1. The breakeven volume is 42,000 units; and the company is operating at a profit.
  2. The breakeven volume is 42,000 units; and the company is operating at a loss.
  3. The breakeven volume is 50,000 units; and the company is operating at a profit
  4. The breakeven volume is 65,000 units; and the company is operating at a profit
  5. None of the above
  6. We know that in Week 1, there are 20 ABCs in stock (i.e., 20 units of product ABC as on-hand inventory). We also know that there are scheduled receipts planned for week 3 and week 4 of 120 ABCs in each of these weeks. We also know that this product ABC has a lead time of 1 week. When and how large of an order should be placed (i.e., planned order release) to meet the gross requirement of 340 ABCs in week 5? Note: There are no other Gross Requirements in the other weeks.
    1. Week 4, 80 units of ABC
    2. Week 4, 60 units of ABC
    3. Week 3, 88 units of ABC
    4. Week 4, 40 units of ABC
    5. Week 4, 88 units of ABC

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