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# I need help finding the answers to the questions attached, the class is Operating and Financial leverage

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I need your help finding the answer to the folloing problems:

Shock Electronics sells portable heaters for \$25 per unit, and the variable cost to produce them is \$17. Mr. Amps estimates that the fixed costs are \$96,000.
a.) How do I compute the break-even point in units?

b.) How do I fill in the table below (in dollars) to illustrate that the break-even point has been achieved.

sales
fixed costs
total variable costs
net profit (loss)

Therapeutic Systems sells its products for \$8 per unit. It has the following costs:
Rent \$120,000
Factory labor \$1.50 per unit
Executive salaries \$112,000.
Raw material \$.70 per unit

How do I seperate the expenses between fixed and variable costs per unit. And using this information and the sales per unit of \$6, How do I compute the break- even point?

I greatly appreciate your help thank you very much

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#### Solution Preview

Shock Electronics sells portable heaters for \$25 per unit, and the variable cost to produce them is \$17. Mr. Amps estimates that the fixed costs are \$96,000.
a.) How do I compute the break-even point in units?
the marginal contribution of each unit is MC = P-VC = 25-17= \$8
Then the break-even point q = ...

\$2.49