1) Mary Williams, owner of Williams Products, is evaluating whether to introduce a new product line. After thinking through the production process and the costs of raw materials and new equipment, Williams estimates the variable costs of each unit produced and sold at $6 and the fixed costs per year at $60,000.
1) Mary Williams, owner of Williams Products, is evaluating whether to introduce a new product line. After thinking through the production process and the costs of raw materials and new equipment, Williams estimates the variable costs of each unit produced and sold at $6 and the fixed costs per year at $60,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:1) Mary Williams, owner of Williams Products, is evaluating whether to
introduce a new product line. After thinking through the production process
and the costs of raw materials and new equipment, Williams estimates the
variable costs of each unit produced and sold at $6 and the fixed costs per
year at $60,000.
A) If the selling price is set at $18 each, how many units must be produced
and sold for Williams to break even? Use both graphic and algebraic
approaches to get your answer. (show how you got the graphical approach
in excel and show numbers)
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