15. ERD Company manufactures and sells two types of beach towels, standard and deluxe. ERD expects the following operating results next year for each type of towel: Standard Deluxe Sales P450,000 P50,000 Variable expenses (total) P360,000 P20,000 If ERD expects to incur P57,600 in fixed expenses next year, its break-even point must be:

15. ERD Company manufactures and sells two types of beach towels, standard and deluxe. ERD expects the following operating results next year for each type of towel: Standard Deluxe Sales P450,000 P50,000 Variable expenses (total) P360,000 P20,000 If ERD expects to incur P57,600 in fixed expenses next year, its break-even point must be:

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 4P

See similar textbooks

Similar questions

EOQ for manufacturer. Sk8 Company produces skateboards and purchases 20,000 units of a wheel bearing each year at a cost of $1 per unit. Sk8 requires a 15% annual rate of return on investment. In addition, the relevant carrying cost (for insurance, materials handling, breakage, etc.) is $0.17 per unit per year. The relevant ordering cost per purchase order is $38.40.
Slosh Cleaning Corporation services both residential and commercial customers. Slosh expects the following operating results next year for each type of customer: Residential Commercial Sales P60,000 P140,000Contribution margin ratio 50% 30% Slosh expects to have P50,000 in fixed expenses next year. What would Slosh's peso sales revenues from Commercial customers have to be next year in order to generate a profit of P166,000?
Need help
ABC Corporation sells its product for $12 per unit. Next year, fixed expenses are expected to be $400,000 and variable expenses are expected to be $8 per unit. How many units must the company sell to generate a target profit (net operating income) of $80,000?
Desk company has a product that it currently sales in the market for $50 per unit. Desk has develop in new feature that, if added to existing product, will allow Desk to receive a price of $65 per unit. The total cost of adding this new future is $44,000 and Desk expects to sell 2,800 units in the coming year. What is the net effect on the next-year's operating income of adding the feature to the product?
Part ASmart Swim Ltd manufactures and sells swimsuits for $40 each. The estimated income statement for 2020 is as follows:Sales $2,000,000Variable costs (1,100,000)Contribution margin 900,000Fixed costs (765,000)Pre-tax profit $135,000Required:Show all your workings.i. Calculate the company’s break-even point in units of swimsuits and sales dollars for 2020.ii. Calculate the company’s margin of safety in the units of swimsuits. iii. Assume the margin of safety in 2019 was 5,000 units of swimsuits. Are the company’s operations more or less risky in 2020 as compared to 2019? Explain. iv. Assume 2020’s actual sales revenue is $200,000 higher than the projected sales. Calculate the actual pre-tax profit of 2020 assuming the unit selling price, the unit variable cost and the total fixed costs remain constant. v. Assume a tax rate of 40%. Calculate the units of swimsuits that must be sold to earn an aftertax profit of $180,000 assuming the unit selling price, the unit variable cost and the…
How many units must company sell?
general acounting
PT Manunggal sells its production during 2022 as many as 15,000 units with a selling price of Rp. 10,000 per unit. To produce 15,000 units, the fixed costs are Rp. 50 million and variable costs are Rp. 4,000 per unit. For 2023, it is estimated that the number of units sold will increase by 10%. Requested: Assuming the selling price, fixed costs and variable costs do not change, calculate the estimated operating profit/loss for 2023. Notes : Write it down along with the complete way of working
What is the firm's estimated EOQ?
In the next month, the company want to launch new product, a night cream. The selling price for Night Cream is $15 and variable cost per unit to produce is $5. The total fixed cost to produce night cream is $525,000. The sales mix between face wash and night cream is 2:1. Compute break-even unit for each product
Please help me. Thankyou.