You are currently trying to decide between two cost structures for your business: one that has a greater proportion of short-term fixed costs and another that is more heavily weighted to variable costs. Estimated revenue and cost data for each alternative are as follows: Cost Structure Alternative 1 Alternative 2 Selling price per unit $ 50 $ 50 Variable cost per unit 35 30 Short-term fixed costs per year 10,000 15,000 Required: 1. What sales volume, in units, is needed for the total costs in each cost-structure alternative to be the same? 2. Suppose your profit goal for the coming year is 10% of sales (i.e., operating profit/sales = 10%). What sales level in units is neededYou are currently trying to decide between two cost structures for your business: one that has a greater proportion of short-term fixed costs and another that is more heavily weighted to variable costs. Estimated revenue and cost data for each alternative are as follows:

	Cost Structure
	Alternative 1	Alternative 2
Selling price per unit	$ 50	$ 50
Variable cost per unit	35	30
Short-term fixed costs per year	10,000	15,000

Required:

1. What sales volume, in units, is needed for the total costs in each cost-structure alternative to be the same?

2. Suppose your profit goal for the coming year is 10% of sales (i.e., operating profit/sales = 10%). What sales level in units is needed under each alternative to achieve this goal?

3. Suppose again that your profit goal for the coming year is 10% of sales. What sales volume in dollars is needed under each alternative to achieve this goal?