Patrick Ross has three booth rental options at the county fair where he plans to sell...
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Patrick Ross has three booth rental options at the county fair where he plans to sell his new product. The booth rental options are: $1,400 fixed fee, or $1725 fixed fee + 10% of all revenues generated at the fair, or 20% of all revenues generated at the fair. Option 1: Option 2: Option 3: The product sells for $25 per unit. He can purchase the units for $11 each. a. Compute the breakeven point for each option. b. What is the margin of safety assuming 1000 are sold, for option (1)? QUESTION (2) Nancy's Niche sells a single product. 8,000 units were sold resulting in $80,000 of sales revenue, $16,000 of variable costs, and $10,000 of fixed costs. The contribution margin per unit is? Patrick Ross has three booth rental options at the county fair where he plans to sell his new product. The booth rental options are: $1,400 fixed fee, or $1725 fixed fee + 10% of all revenues generated at the fair, or 20% of all revenues generated at the fair. Option 1: Option 2: Option 3: The product sells for $25 per unit. He can purchase the units for $11 each. a. Compute the breakeven point for each option. b. What is the margin of safety assuming 1000 are sold, for option (1)? QUESTION (2) Nancy's Niche sells a single product. 8,000 units were sold resulting in $80,000 of sales revenue, $16,000 of variable costs, and $10,000 of fixed costs. The contribution margin per unit is?
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Answer rating: 100% (QA)
To compute the breakeven point for each option we need to calculate the number of units or revenues at which the total costs equal the total revenues ... View the full answer
Related Book For
South-Western Federal Taxation 2020 Comprehensive
ISBN: 9780357109144
43rd Edition
Authors: David M. Maloney, William A. Raabe, James C. Young, Annette Nellen, William H. Hoffman
Posted Date:
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