Owen Lars operates a business that sells enhanced condensers to the water farmers on Tatooine. He buys
Question:
Owen Lars operates a business that sells enhanced condensers to the water farmers on
Tatooine.
He buys basic condensers from his supplier on Cloud City for $400 per condenser
and sells them for $800 each aVer he has modified them to perform in the
scorching heat of Tatooine.
He pays $20,000 per month to rent his producDon facility and $3,000 per month
for uDliDes.
The work on modifying the condensers is done by a team of droids. He incurs
monthly operaDng expenses of $4,500 per month to keep the droids funcDoning
properly.
1. How many condensers does Owen have to sell each year to break-even?
2. If Owen wanted to make $8,000 per month in profit, how many additional condensers would he have to sell each year, i.e. a number of units over and above the breakeven level of sales?
Taxation Of Individuals And Business Entities 2015
ISBN: 9780077862367
6th Edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver