Produces and sells one product, watches, for $13.00 each. To ensure top quality, no inventories are maintained. Estimated costs are:

  

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Variable Costs Per Watch Manufacturing costs: Direct materials Direct labor Manufacturing overhead Selling and administrative Total $5.00 1.00 1.25 $7.25 1.00 $8.25 Fixed Costs Per Month Manufacturing overhead Selling and administrative Total $2,000 900 $2,900 Answer the following questions 1. How many watches would Timepiece Inc. need to sell to make a profit of $6,000? 2. How much would Timepiece Inc. make in profit if they sold 8,000 watches? 3. If sales increase by 2,000 watches per month, by how much will net income increase? 4. If sales increase by $2,000 per month, by how much will net income increase? 5. What is the break-even unit sales volume? Variable Costs Per Watch Manufacturing costs: Direct materials Direct labor Manufacturing overhead Selling and administrative Total $5.00 1.00 1.25 $7.25 1.00 $8.25 Fixed Costs Per Month Manufacturing overhead Selling and administrative Total $2,000 900 $2,900 Answer the following questions 1. How many watches would Timepiece Inc. need to sell to make a profit of $6,000? 2. How much would Timepiece Inc. make in profit if they sold 8,000 watches? 3. If sales increase by 2,000 watches per month, by how much will net income increase? 4. If sales increase by $2,000 per month, by how much will net income increase? 5. What is the break-even unit sales volume?

Answer rating: 100% (QA)

To answer the questions we need to calculate the relevant values based on the given information 1 To determine the number of watches Timepiece Inc nee... View the full answer