How many units must rosenberg sell in the first year

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Reference no: EM131989575

In order to get the break even point i need to get the total fixed costs and divided by the contribution margin per unit. My question is if i will need to add the fixed manufacturing costs for FY 2018.

Retail price                                                   : $659                                    

           Retail margin                                               : 42.5%

           Wholesale margin                                       : 27.5%

           R & D on hearing aid, FY's 2016, 2017  : $229,000

           Introductory promotional outlays, FY2019: $219,000

           Rosenberg's fixed manufacturing costs  : $250,000 per year (FY 2018)

           Variable manufacturing costs/unit           : $109

           Retailer's salesperson's commission      : 2% of retailer's selling price

           Rosenberg's sales commission                : 5% of manufacturer's selling price

           Population of Big Smoke"                          : 2,350,000

           Proportion of population over 60 years   : 22.5%

a) How many units must Rosenberg sell in the first year to break even? Carefully explain, including any assumptions that you make.

Reference no: EM131989575

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