Casey’s Cases sells cell phone cases in a mall kiosk. Casey charges $40 per case. The variable cost for a case, including the case, the royalty paid to the mall, and so on is $31. The monthly fixed cost for Casey’s Cases is $3,150. Required: a. How many cases must Casey sell every month to break even? b. Casey believes that he can sell 435 cases a month. What is the margin of safety in terms of the number of cases?
Casey’s Cases sells cell phone cases in a mall kiosk. Casey charges $40 per case. The variable cost for a case, including the case, the royalty paid to the mall, and so on is $31. The monthly fixed cost for Casey’s Cases is $3,150. Required: a. How many cases must Casey sell every month to break even? b. Casey believes that he can sell 435 cases a month. What is the margin of safety in terms of the number of cases?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Casey’s Cases sells cell phone cases in a mall kiosk. Casey charges $40 per case. The variable cost for a case, including the case, the royalty paid to the mall, and so on is $31. The monthly fixed cost for Casey’s Cases is $3,150.
Required:
a. How many cases must Casey sell every month to break even?
b. Casey believes that he can sell 435 cases a month. What is the margin of safety in terms of the number of cases?
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