Bakersfield Corp. cupcake break even problem
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Bakersfield Corporation sells cupcakes for $3. The following is the projected income statement for 2014. Variable costs are the cost of the cakes, $1 each, plus a 10% sales commission paid to the worker.
Sales $120,000
Cost of cakes Sold 40,000
_______
Gross Margin 80,000
Operating Expenses
Salaries and Commissions 30,000
Rent 24,000
Other Fixed Expenses 8,750
_______
Total Operating Expenses 62,750
_______
Net Income $ 17,250
_______
_______
What is the number of cakes that needs to be sold to break even?
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Solution Summary
Calculation of break even point for the sample company Bakersfield Corp.
Education
- BSc, Dokuz Eylul University
- MBA, Texas A&M University-Kingsville
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