S2005Final_Solution

# S2005Final_Solution - Accounting 294 Spring 2005 Final Exam...

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Problem 2 Required (8 marks): a. Using the information above, what is her target operating income per unit?  (1 mark) Target operating income per unit = \$10,000 /20,000 units = \$0.50 b. If Bridget was not concerned about earning \$10,000 what would be her breakeven point in  hot dogs assuming she matches the competitor’s price?  (2 marks) \$2.40 – (1.50 + .40) = \$.50 CM per unit.  \$2,600/.50 = 5,200 dogs c. Assuming the sales projection of 20,000 units is correct; can she expect to earn the  \$10,000 at the target price?  Support your answer with calculations.  (4 marks) The best answer here will be to show the CM x 20,000 units for a total operating profit of \$10,000.  Give marks for the logic of the effort as well as the final total. d.
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S2005Final_Solution - Accounting 294 Spring 2005 Final Exam...

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