Cox Electric makes electronic components and has estimated the following for a new design of one of its products.Fixed cost = $23,750Material cost per unit = $0.17• Labor cost per unit = $0.12• Revenue per unit = $0.67Note that fixed cost is incurred regardless of the amount produced. Per-unit material and labor cost together make up the variablecost per unit. Assuming that Cox Electric sells all that it produces, profit is calculated by subtracting the fixed cost and total variablecost from total revenue.Construct an appropriate spreadsheet model to find the profit based on a given production level and use the spreadsheet model toanswer these questions.(a) Construct a one-way data table with production volume as the column input and profit as the output. Breakeven occurs whenprofit goes from a negative to a positive value; that is, breakeven is when total revenue = the total cost, yielding a profit ofzero. Vary production volume from 0 to 100,000 in increments of 10,000. In which interval of production volume doesbreakeven occur?tounits(b) Use Goal Seek to find the exact breakeven point. Assign Set cell: equal to the location of profit, To value: 0, and Bychanging cell: equal to the location of the production volume in your model.units

Answered: Image /qna-images/answer/d1ca3392-9214-4791-8549-dc3bb7c7b5ec.jpg

Answered: Cox Electric makes electronic…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...

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