Carrier Company produces a part used in the small appliance industry. The company produces and sells 120,000 parts per year. The selling price is $4 per part; variable costs are $2.50 per part; fixed costs are $50,000 per year.
What is the breakeven point in dollars and units?
After conducting research, the president feels that a 5% reduction in the partâ??s selling price will result in a 20% increase in the number of parts sold. Prepare a CVP statement reflecting these changes.
The solution explains how to calculate the breakeven point in dollars and units and prepare a CVP statement