Eastman Publishing company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be P160,000. Variable production and materials costs are estimated to be P6 per book. The publisher plans to sell the text to college and university bookstores for P46 each. A. What is the break-even point? B. What profit or loss can be anticipated with a demand of 3,800 copies? C. With a demand of 3,800 copies, what is the minimum price per copy that the publisher must change to break-even? D. If the publisher believes that the price per copy coud be increase to P50.95 and not affected the anticipated demand of 3,800 copies, what action would you recommend? What profit or loss can be anticipated?
Eastman Publishing company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be P160,000. Variable production and materials costs are estimated to be P6 per book. The publisher plans to sell the text to college and university bookstores for P46 each.
A. What is the break-even point?
B. What profit or loss can be anticipated with a demand of 3,800 copies?
C. With a demand of 3,800 copies, what is the minimum price per copy that the publisher must change to break-even?
D. If the publisher believes that the price per copy coud be increase to P50.95 and not affected the anticipated demand of 3,800 copies, what action would you recommend? What profit or loss can be anticipated?
Trending now
This is a popular solution!
Step by step
Solved in 5 steps
