A local company assembling stereo radio cassette produces 300 units per month at a cost of 800 per unit. Each stereo radio cassette sells for 1,200. If the firm makes a profit of 10% on its 10,000 shares with a par value of P 200 per share, and the fixed costs are 20,000 per month. (a) What is the break-even point? Draw Breakeven Chart (b) How much is the loss or profit if only 100 units are produced in a given month?
A local company assembling stereo radio cassette produces 300 units per month at a cost of 800 per unit. Each stereo radio cassette sells for 1,200. If the firm makes a profit of 10% on its 10,000 shares with a par value of P 200 per share, and the fixed costs are 20,000 per month. (a) What is the break-even point? Draw Breakeven Chart (b) How much is the loss or profit if only 100 units are produced in a given month?
Chapter14: Capital Structure Management In Practice
Section14.A: Breakeven Analysis
Problem 6P
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A local company assembling stereo radio cassette produces 300 units per month at a cost of 800 per unit. Each stereo radio cassette sells for 1,200. If the firm makes a profit of 10% on its 10,000 shares with a par value of P 200 per share, and the fixed costs are 20,000 per month.
(a) What is the break-even point? Draw Breakeven Chart
(b) How much is the loss or profit if only 100 units are produced in a given month?
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