a- Calculate the breakeven quantity for the company b- Develop a one-way data table to examine the effect of the change in the land price from 50000 to 60000 with increments of 1000 on the breakeven point c- Develop a two-way table to examine the change in the monthly salaries and selling price on the breakeven quantity. Use values from 100,000 to 120,000 with increments of 2,000 for the selling price and values from 30,000 to 40,000 with increments of 2000 for the monthly salaries.
a- Calculate the breakeven quantity for the company b- Develop a one-way data table to examine the effect of the change in the land price from 50000 to 60000 with increments of 1000 on the breakeven point c- Develop a two-way table to examine the change in the monthly salaries and selling price on the breakeven quantity. Use values from 100,000 to 120,000 with increments of 2,000 for the selling price and values from 30,000 to 40,000 with increments of 2000 for the monthly salaries.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Ponderosa Development Corporation (PDC) is a small real
estate developer that builds only one style cottage.
The selling price of the cottage is $115,000. The cost per cottage
includes land for $55,000 and lumber, supplies, and other
materials run another for $28,000. Total labor costs are
approximately $20,000 per cottage. The one salesperson of PDC
is paid a commission of $2,000 on the sale of each cottage.
Ponderosa leases office space for $2,000 per month. The cost of
supplies, utilities, and leased equipment runs another $3,000 per
month. PDC has seven permanent office employees whose
monthly salaries are $35,000.
a- Calculate the breakeven quantity for the company
b- Develop a one-way data table to examine the effect of the
change in the land price from 50000 to 60000 with
increments of 1000 on the breakeven point
c- Develop a two-way table to examine the change in the
monthly salaries and selling price on the breakeven
quantity. Use values from 100,000 to 120,000 with
increments of 2,000 for the selling price and values from
30,000 to 40,000 with increments of 2000 for the monthly
salaries.
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