Break-even analysis-what is the break-even point

Assignment Help Financial Management

Reference no: EM131571906

BREAK-EVEN ANALYSIS The Weaver Watch Company sells watches for $25, fixed costs are $140,000, and variable costs are $15 per watch.

a. What is the firm’s gain or loss at sales of 8,000 watches? At 18,000 watches?

b. What is the break-even point? Illustrate by means of a chart.

c. What would happen to the break-even point if the selling price was raised to $31? What is the significance of this analysis?

d. What would happen to the break-even point if the selling price was raised to $31 but variable costs rose to $23 a unit?

Reference no: EM131571906

Questions Cloud

Dividend for the last several years : It has paid a $2.50 dividend for the last several years. The return on stock of similar firms is 6%. At what price should DM's stock sell for today?

Describe the stirling numbers : Describe some of the properties and the identities that Stirling numbers of the second kind satisfy, including the connection between Stirling numbers.

Do you prefer one type of nature to another : Did you have positive or negative experiences with nature as a child? What about today? Do you prefer one type of nature to another?

Describe what makes up a motor unit : Describe what makes up a motor unit and how recruitment of motor units relates to contraction response.

Break-even analysis-what is the break-even point : What is the break-even point? Illustrate by means of a chart. What is the firm’s gain or loss at sales of 8,000 watches? At 18,000 watches?

What annual interest rate is paul charging you : Financing is available, and the terms are 10% down and payments of $65.00 a month for 40 months. What annual interest rate is Paul charging you?

Training program explaining net present value : You have been asked by a manager in your organization to put together a training program explaining Net Present Value (NPV) and Future

Discuss visual cortex play in the occidental lobe : What role does the primary visual cortex play in the occidental lobe, and describe it's function

Estimate the cost of capital earned by everlast batteries : Estimate the return on capital earned by Everlast Batteries. Estimate the cost of capital earned by Everlast Batteries.

User Account

All Pages