View the step-by-step solution to:

Fredonia Inc. had a bad year in 2013. For the first time in its history, it operated at a loss. The company's income statement showed the following...

I need help with the break even point for Increased selling price, Change compensation and Purchase Machinery.
I have included all the details of the question and answered Part A already. I just need help with Part B please!

Fredonia Inc. had a bad year in 2013. For the first time in its history, it operated at a loss. The company’s income statement showed the following results from  selling 76,000 units of product: Net sales $1,459,200; total costs and expenses  $1,741,500; and net loss $282,300. Costs and expenses consisted of the  following.     Total     Variable     Fixed COGS 1201800 779500     422300 Selling Expenses 414800 73100 341700 Administration Expenses 124900 53800 71100 Totals 1741500 906400 835100 Management is considering the following independent alternatives for 2014. 1. Increase unit selling price 29% with no change in costs and expenses. 2. Change the compensation of salespersons from fixed annual salaries  totaling $195,000 to total salaries of $37,300 plus a 5% commission on net sales. 3. Purchase new high-tech factory machinery that will change the proportion  between variable and fixed cost of goods sold to 50:50. Compute the break-even point in dollars for 2014.  (Round contribution margin  ratio to 4 decimal places e.g. 0.2512 and final answers to 0 decimal places,  e.g. 2,510.) Break-even point $ 2204593   b)  Compute the break-even point in dollars under each of the alternative courses  of action.  (Round contribution margin ratio to 4 decimal places e.g. 0.2512  and final answers to 0 decimal places, e.g. 2,510.) Break-even point 1 . Increase selling price $ 2 . Change compensation $ 3 . Purchase machinery $
Background image of page 1
Sign up to view the entire interaction

Recently Asked Questions

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.


Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question