Solution-Find what is the company new break-even point in

Find what is the company new break-even point in units

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Reference no: EM132618921

Super Sales Company is the exclusive distributor for a revolutionary bookbag. The product sells for $60 per unit and has a CM ratio of 40%. The company's fixed expenses are $360,000 per year. The company plans to sell 17,000 bookbags this year.

Required:

Problem 1. What are the variable expenses per unit?

Problem 2. Using the equation method:

a. What is the break-even point in units and in sales dollars?

b. What sales level in units and in sales dollars is required to earn an annual profit of $90,000?

c. Assume that through negotiation with the manufacturer the Super Sales Company is able to reduce its variable expenses by $3 per unit. What is the company's new break-even point in units and in sales dollars?

Problem 3. Repeat (2) above using the formula method.

Reference no: EM132618921

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Find what is the company new break-even point in units

Reference no: EM132618921

Reference no: EM132618921

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