HW2 - SP = $60/unit Answer: Q = $35,000 / ($60 - $34) =...

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Brittany Braud Management 368 Homework 2 June 6, 2011 1. Chapter 3, Problem #12: FC = $40,000 VC = $20/unit 1) If SP = $25, what is the break-even sales volume? Answer: Q = $40,000 / ($25 - $20) = 8,000 units 2) If Q = 10,000 units and SP = $25, what will be the contribution to profit? Answer: 2,000 units x $5/unit = $10,000 2. Additional Problem: What is the break-even volume? FC = $25,000 + $10,000 VC = $4/unit + $30/unit
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Unformatted text preview: SP = $60/unit Answer: Q = $35,000 / ($60 - $34) = 1,346 units 3. Additional Problem: FC = $250,000 SP = $50/unit Q = 20,000 units 1) How low must its VC be to break even? Answer: VC = $50 ($250,000 / 20,000 units) = $37.50 2) Assuming VC = $35, what does the SP have to be to break even? Answer: SP = ($250,000 / 20,000 units) + $35 = $47.50...
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This note was uploaded on 10/17/2011 for the course MNGT 368 taught by Professor Curthurds during the Spring '08 term at Nicholls State.

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