Below is a question I have in my accounting homework from my Professor. I am stumped on how to prepare the budget
without having the estimated amount of packages that delivery service plans to deliver per month. I know this can be used to compute break-even but the question requires a budget projection. Am I missing something?
Speedy Delivery currently delivers packages for $9 each. The variable cost is $3 per package, and fixed costs are $60,000 per month. Project a budget showing the expected current profit and profit after the changes in costs. 1. Fixed costs are increased to $75,000.
2. Selling price is increased by 10%.
3. Variable cost is increased to $4.50 per unit.
4. Show the analysis in a table format.