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2. Compute sales units required to realize income from operations of $630,000.

2. Compute sales units required to realize income from operations of $630,000.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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need help on question 2 thanks 

During the upcoming year, De Anza Co. expects the following data: - Expected unit selling price is: $125 - Expected unit variable cost is: $70 - Expected total fixed costs are: $1,512,500 **Required** 1. Calculate breakeven point in both units and dollars. (Show work in blank space below.) - Round units to the nearest unit and round dollars to the nearest dollar. 2. Compute sales units required to realize income from operations of $630,000. 3. Construct a cost-volume-profit chart assuming maximum sales in the relevant range of 40,000 units. (Use the available graph template below.) Label the following parts of the graph: Sales Revenue, Fixed Costs, Variable Costs, Total Costs, Profit Area, Loss Area, and Break Even Point. **Graph Explanation** - The graph is a grid used to plot the cost-volume-profit analysis. - The x-axis is labeled in units, ranging from 0 to 40,000 in increments of 5,000. - The y-axis is intended for cost amounts, which will be filled in appropriately based on the calculations. - Important markers to plot on the graph include: - Sales Revenue line - Fixed Costs line - Variable Costs line - Total Costs line - The area above the breakeven point indicating Profit Area - The area below the breakeven point indicating Loss Area - The intersection point on the graph indicating the Break Even Point
Transcribed Image Text:During the upcoming year, De Anza Co. expects the following data: - Expected unit selling price is: $125 - Expected unit variable cost is: $70 - Expected total fixed costs are: $1,512,500 **Required** 1. Calculate breakeven point in both units and dollars. (Show work in blank space below.) - Round units to the nearest unit and round dollars to the nearest dollar. 2. Compute sales units required to realize income from operations of $630,000. 3. Construct a cost-volume-profit chart assuming maximum sales in the relevant range of 40,000 units. (Use the available graph template below.) Label the following parts of the graph: Sales Revenue, Fixed Costs, Variable Costs, Total Costs, Profit Area, Loss Area, and Break Even Point. **Graph Explanation** - The graph is a grid used to plot the cost-volume-profit analysis. - The x-axis is labeled in units, ranging from 0 to 40,000 in increments of 5,000. - The y-axis is intended for cost amounts, which will be filled in appropriately based on the calculations. - Important markers to plot on the graph include: - Sales Revenue line - Fixed Costs line - Variable Costs line - Total Costs line - The area above the breakeven point indicating Profit Area - The area below the breakeven point indicating Loss Area - The intersection point on the graph indicating the Break Even Point
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