Use the below table to answer the following questions.Selling Price = $43.00Fixed Cost$47,20047, 20047,20057, 20057, 20057, 20067,20067,20067,200RequiredVariableCost1516171516171516172,200$14,40012, 20010,0004,4002,200(5,600)(7,800)(10,000)3,200$42,40039, 20036,00032,40029, 20026,00022,40019, 20016,000Sales Volume4,200Profitability$70,40066, 20062,00060,40056,20052,00050,40046, 20042,0005,200$98,40093,20088,00088,40083,20078,00078,40073,20068,0006, 200$126,400120, 200114,000116,400110, 200104,000106,400100, 20094,000a. Determine the sales volume, fixed cost, and variable cost per unit at the break-even point.b. Determine the expected profit if Franklin projects the following data for Delatine: sales, 4,200 bottles; fixed cost, $47,200; andvariable cost per unit, $17.c. Franklin is considering new circumstances that would change the conditions described in Requirement b. Specifically, the companyhas an opportunity to decrease variable cost per unit to $15 if it agrees to conditions that will increase fixed cost to $57,200. Volumeis expected to remain constant at 4,200 bottles. Determine the effects on the company's profitability if this opportunity is accepted.

The breakeven point is the point at which a company makes no profit or loss.

elling Price = $43.00 Fixed Cost $47,200 47,200 47,200 57, 200 57, 200 57,200 67,200 67,200 67,200 equired Variable Cost 15 16 17 15 16 17 15 16 17 - 2,200 $14,400 12,200 10,000 4,400 2,200 (5,600) (7,800) (10,000) 3,200 $42,400 39,200 36,000 32,400 29, 200 26,000 22,400 19, 200 16,000 Sales Volume 4,200 Profitability $70,400 66, 200 62,000 60,400 56,200 52,000 50,400 46,200 42,000

elling Price = $43.00 Fixed Cost $47,200 47,200 47,200 57, 200 57, 200 57,200 67,200 67,200 67,200 equired Variable Cost 15 16 17 15 16 17 15 16 17 - 2,200 $14,400 12,200 10,000 4,400 2,200 (5,600) (7,800) (10,000) 3,200 $42,400 39,200 36,000 32,400 29, 200 26,000 22,400 19, 200 16,000 Sales Volume 4,200 Profitability $70,400 66, 200 62,000 60,400 56,200 52,000 50,400 46,200 42,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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