Cost Volume Profit Analysis
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A company sells calculators at $27 each. It has monthly fixed costs of $3800 each and material costs $3 per unit, labour costs of $1 per unit, and other variable costs $10 per unit.
1. What is the breakeven point in sales dollars?
2. What is net income at a level of sales of 350 units?
3. How many units must they sell to earn a monthly profit of $600?
4. What are total costs at breakeven?
5. What are total costs at a sales level of 450 units?
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Solution Summary
The solution performs CVP analysis for a company selling calculators by providing relevant formula's.
Solution Preview
Variable Cost = Material Cost + Labor + other Variable cost
Variable Cost =3+1+10 = 14
Contribution per unit = Sale price - variable cost = 27 - 14 = ...
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