Annual breakeven point, Basic Statistics

Hanks Western Wear is a western hat retailer in Lubbock, TX.  Though Hanks carries various styles of western hats, every hat has approximately the similar price and invoice (purchase) cost, as shown in the following table.  Sales personnel receive large commissions to encourage them to be more aggressive in their sales efforts.  Presently, the Lubbock economy is really humming, and sales growth at Hank's has been great.  The business is very competitive, thus, and Hank has relied on his knowledgeable and courteous staff to attract and retain customers who otherwise might go to other western wear stores.  Due to of the rapid growth in sales, Hank is also finding the management of certain aspects of the business, like restocking of inventory and hiring and training new salespeople, more difficult.

 

Sales Price                                            $45.00

Per unit variable expenses

   Purchase cost                                      25.50

   Sales Commissions                              4.50

Total per unit variable costs                    $30.00

 

Total annual fixed expenses

   Advertising                                        $22000

   Rent                                                 18000

   Salaries                                            185000

Total fixed expenses                            $225000

 

 

Needed:-

1. Measure the annual breakeven point in unit sales and dollar sales

2. If Hank sells 20,000 hats, what is its before-tax income or loss?

3. If Hank's sells 30,000 hats, what is its margin of safety and margin of safety ratio?

 

Posted Date: 3/20/2013 6:34:03 AM | Location : United States







Related Discussions:- Annual breakeven point, Assignment Help, Ask Question on Annual breakeven point, Get Answer, Expert's Help, Annual breakeven point Discussions

Write discussion on Annual breakeven point
Your posts are moderated
Related Questions
A team of archeologists have discovered the fossil skull of an extinct and exceptionally large crocodile (sarcosuchus).  Unfortunately, they have not been able to fi

The weight in Kg for each person was matched to their intake of fat per day in Grams.  9 people were selected with the following results. Weight (Xi)         Fat (Yi) 45


1. (TCO 8) Planning for capital investments is an important function of management. You are responsible for considering purchasing a new exhibit. It would cost $136,000 and have

How to start solving the null hypothesis that the mean daily caloric intake in the adult population of a rural county is 1800 calories. A sample of 400 had a mean of 1785 and SD 24

Ask question #Midifferentiate between sample and populationnimum 100 words accepted#

what is the difference between histogram and historigram

Mode Mode, M is the value that has the largest number of occurrence or frequency in a data set, for instance, given the following data:  11 15 16 12 15 19 17 15 we can se


why should cofficient of variation be used to compare the dispersion?