Assume you have developed and tested a prototype electronic gadget and are about to start your new business. You purchase preassembled modules at $80 per unit. Other component costs include plastic casings at $18 per unit and assembly hardware at $6 per unit. Direct labor costs are $20 per hour and four units can be produced per hour. You intend to sell each unit at a 60 percent markup over the total costs of producing each unit. The plan is to produce 600 product units per month in January, February, and March. Sales are expected to be 250 units in January, 350 units in February, and 900 units in March. Calculate the dollar amount of sales revenue expected in each month (i.e., January, February, and March) and for the first quarter of the year.

Assume you have developed and tested a prototype electronic gadget and are about to start your new business. You purchase preassembled modules at $80 per unit. Other component costs include plastic casings at $18 per unit and assembly hardware at $6 per unit. Direct labor costs are $20 per hour and four units can be produced per hour. You intend to sell each unit at a 60 percent markup over the total costs of producing each unit. The plan is to produce 600 product units per month in January, February, and March. Sales are expected to be 250 units in January, 350 units in February, and 900 units in March. Calculate the dollar amount of sales revenue expected in each month (i.e., January, February, and March) and for the first quarter of the year.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 10EB: Keleher Industries manufactures pet doors and sells them directly to the consumer via their web...

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