BREAK-EVEN ANALYSIS The Warren Watch Company sells watches for $26, fixed costs are$155,000, and variable costs are $13 per watch.a. What is the firm's gain or loss at sales of 9,000 watches? At 15,000 watches?What is the break-even point? Illustrate by means of a chart.b.C.What would happen to the break-even point if the selling price was raised to $33?What is the significance of this analysis?d. What would happen to the break-even point if the selling price was raised to $33 butvariable costs rose to $24 a unit?

A break-even analysis is a financial calculation that weighs the costs of a new business, service or…

BREAK-EVEN ANALYSIS The Warren Watch Company sells watches for $26, fixed costs are $155,000, and variable costs are $13 per watch. a. What is the firm's gain or loss at sales of 9,000 watches? At 15,000 watches? b. What is the break-even point? Illustrate by means of a chart. C. What would happen to the break-even point if the selling price was raised to $33? What is the significance of this analysis? d. What would happen to the break-even point if the selling price was raised to $33 but variable costs rose to $24 a unit?

BREAK-EVEN ANALYSIS The Warren Watch Company sells watches for $26, fixed costs are $155,000, and variable costs are $13 per watch. a. What is the firm's gain or loss at sales of 9,000 watches? At 15,000 watches? b. What is the break-even point? Illustrate by means of a chart. C. What would happen to the break-even point if the selling price was raised to $33? What is the significance of this analysis? d. What would happen to the break-even point if the selling price was raised to $33 but variable costs rose to $24 a unit?

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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