Break Even Analysis

Break Even Analysis - Break-Even Analysis 1. Engineering...

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Break-Even Analysis 1. Engineering estimates indicate the variable cost of manufacturing a new product will be $35 per unit. Based on market research, the selling price of the product is to be $120 per unit and variable selling expense is expected to be $15 per unit. The fixed costs applicable to the new product are estimated to be $2800 per period and capacity per period is 100 units. Assuming that each part is independent of the one that precedes it, determine (a) the income at a volume of 70 units; (b) the net income at a volume of 30% of capacity; (c) the net income at a sales volume of $10,200; (d) the level of operations as a percent of capacity to generate a net income of $2240; (e) the number of units that must be sold to make a net income of $1050; (f) the sales volume in dollars to suffer a loss of no more that $350; (g) the break-even point in units if fixed costs are increased to $3150; (h) the break-even point as a percent of capacity if fixed costs are reduced by $160 and the variable cost of manufacturing is increased to $39 per unit; (i) the break-even point in dollars if the selling price is reduced to $100 per unit. 2. The following data pertains to the operating budget of Matt Manufacturing. Sales $720,000 Less: Fixed costs $220,000 Gross Profit $500,000 Less: Variable costs 324,000 Net Income $176,000 Capacity is a sales volume of $800,000 per period. Determine: (a) the net income at 85% capacity; (b) the net income at 30% of capacity; (c) the level of operations as a percent of capacity to realize a net income of $66,000; (d) the level of operations in dollars to sustain a loss of no more than $6600; (e) the break-even point in dollars if fixed costs are increased by 15%; (f) the break-even point as a percent of capacity if fixed costs are decreased by $18,400 and variable costs are increased to 52% of sales.
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3. The lighting division of Universal Electric Company plans to introduce a new streetlight based on the following accounting information. Fixed costs per period are $3136; variable cost per unit is $157; selling
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Break Even Analysis - Break-Even Analysis 1. Engineering...

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