Chapter 3 Problems

Chapter 3 Problems - Chapter 3 Problems Use the following...

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Chapter 3 Problems Use the following information for Boxware Corporation to answer the next four questions: Sales price per unit \$190 Variable cost per unit \$ 80 Average production 1,500 units per month Total fixed costs \$55,000 per month 1. What is Boxware's contribution margin per unit? 2. How many units per month must Boxware sell in order to break even? 3. What amount of dollar sales must Boxware achieve each month in order to break even? 4. How many units per month must Boxware sell in order to make a \$110,000 profit? Use the following information to answer the next three questions: Derek's Drum Depot (DDD) wants to add a new line of drumsticks to its product line. The following data apply to the new drumsticks line. Budgeted sales 30,000 sets per year Sales price \$5 per set Variable costs \$3 per set Fixed costs \$10,000 per year 5. The break-even point for the new line is 6. The margin of safety for DDD in sales dollars is 7. How many sets of drumsticks must DDD sell to make a profit of \$50,000 on the new line? 8.

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Chapter 3 Problems - Chapter 3 Problems Use the following...

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