Question: Travis purchased a new printing machine and started a small printing shop. As per his calculations, to earn revenue of $4,500 per month, he needs
Travis purchased a new printing machine and started a small printing shop. As per his calculations, to earn revenue of $4,500 per month, he needs to sell printouts of 28,000 sheets per month. The printing machine has a capacity of printing 38,300 sheets per month, the variable costs are $0.02 per sheet, and the fixed costs are $2,100 per month.
a. Calculate the selling price of each printout. (Round to two decimal places)
b. If they reduce fixed costs by $380 per month, calculate the new break-even volume per month. (Round up to the next whole number)
c. Calculate the new break-even volume as a percent of capacity. (Round to two decimal places)
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