Question: A product currently sells for $12 per unit. The variable costs are $4 per unit, and 10,000 units are sold annually and a profit of

  1. A product currently sells for $12 per unit. The variable costs are $4 per unit, and 10,000 units are sold annually and a profit of $30,000 is realized per year. A new design will increase the variable costs by 20% and Fixed Costs by 10% but sales will increase to 12,000 units per year. (a) At what selling price do we break even, and (b) If the selling price is to be kept same ($12/unit) what will the annual profit be?

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Economics Questions!

Q:

A product currently sells 12 pesos per unit. The variable costs are 4 pesos per unit, and 10,000 units are sold annually and a profit of 30,000 pesos is realized per year. A new design will increase...

Q:

A product currently sells 12 php per unit. The variable costs are 4 php per unit, and 10,000 units are sold annually and a profit of 30,000 php is realized per year. A new design will increase the...

Q:

Please solve the following problem: A product currently sells for $15 per unit. The variable costs are $6 per unit, and 8000 units are sold annually and a profit of $40,000 is realized per year. A...

Q:

A product currently sells for $15 per unit. The variable costs are $6 per unit, and 8000 units are sold annually and a profit of $40,000 is realized per year. A new design will increase the variable...

Q:

A product currently sells for $18 per unit. The variable costs are $6 per unit, and 10,000 units are sold annually and a profit of $25,000 is realized per year. A new design will increase the...

Q:

Product X currently sells for $12 per unit. The variable costs is $4 per unit and 10,000 units are sold annually with a profit of $30,000 per year. A new design will increase the variable cost by 20%...

Q:

COST-VOLUME-PROFIT (CVP) ANALYSIS Abner Corporation makes a product that sells for $200 per unit. The variable costs to make this product are $120 per unit. Fixed costs total $500,000 for a year....

Q:

Use File Attached 2.) Burien allocates building depreciation, maintenance, and utilities on the basis of square footage. Office expenses are allocated on the basis of sales. Management is considering...

Q:

Only Answer Exercise 2 and 3 please. After completing Exercise 2, What is the number of units needed to achieve the desired profit? After completing Exercise 3- situation 1, what is the number of...

Q:

Question 6 Not yet answered (Ch6) Candle Co. has sales of $200,000 this month, contribution margin of $100,000, monthly fixed cost of $80,000 and profit of $20,000. What is the firm's current...

Q:

Write a chemical equation that represents (NH4)3PO4(s) dissociating in water.

Q:

a For the following reaction, give the balanced equation for the reaction and state the meaning of the equation in terms of the numbers of individual molecules. PC13 (1) + HO(1) H3PO3(aq) + HCl(g)...

Q:

The following information is available for Harrison Corporation for the year ended December 3 1 , 2 0 2 4 : Collection of principal on long - term loan to a supplier $ 1 5 , 0 0 0 Acquisition of...

Q:

Case Business Judgment Rule In re The Walt Disney Co. Derivative Litigation 907 A.2d 693 (Del. Ch. 2005) The Walt Disney Company hired Ovitz as its executive president and as a board member for five...

Q:

8. Set a goal that you really want to achieve in the near future, lets say 12 years. How does this goal fit in relation to the form roles and values above? What role and what value was it that...

Q:

7. Fill out the form below. Only the most important roles and your basic values are to be filled.

Q:

10. Try to remember the last communication you entered into. How many times did you fill in information that the other person did not convey? How many times did you speak before the other person...