Question: Flipper has just completed the final development of its only product, general pesticide ,which can be programmed to kill most insects before dying themselves. The
Flipper has just completed the final development of its only product, general pesticide ,which can be programmed to kill most insects before dying themselves. The product has taken 3 years and $6,000,000 to develop. The following costs are expected to be incurred on a monthly basis for the normal production level of 1,000,000 pounds of the new product:
| Direct materials | 300,000 |
| direct labor | 1,250,000 |
| variable factory overhead | 450,000 |
| fixed factory overhead | 2,000,000 |
| variable selling general and admin | 900,000 |
| fixed selling general and admin | 1,500,000 |
| total | $ 6,400,000 |
At a sales price of $5.90 per pound, the sales in pounds necessary to ensure a $3,000,000 profit the first year would be (to the nearest thousand pounds)
A. 13,017,000 pounds. B. 14,000,000 pounds. C. 15,000,000 pounds. D. 25,600,000 pounds.
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