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Kaizer Plastics produces a variety of plastic items for packaging and distribution. One item, container #145, has had a low contribution to profits. Last year, 20,000 units of container #145 were produced and sold. The selling price of the container was $20 per unit, with a variable cost of $18 per unit and a fixed cost of $70,000 per year.
(a) Construct a correct, flexible, and documented base-case spreadsheet model that allows the user to easily vary the inputs to the problem and see the resulting revenue, costs, and profit. What is the profit level for the base case?
(b) Using the model and Goal Seek, find the break-even quantity.
(c) Construct a Data Table and chart showing profit versus quantity.
Prepare Dold's journal entries for the initial transaction, recognition of interest each year, and the collection of $20,000 at maturity and prepare the journal entry for Arness to record the sale
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