Green Rider makes three types of electric scooters. The company's total fixed cost is $2,592,000,000. Selling prices, variable cost, and sales percentages for each type of scooter follow: Selling Price Variable Cost Percent of Total Unit Sales $2,200 $1,900 3,700 3,000 X-treme 6,000 5,000 a. What is Green Rider's break-even point in units and sales dollars? Mod Rad Mod Rad X-treme Total Mod Rad Units Dollars 1,215,000 $ 2,673,000,0 2,025,000 810,000 4,050,000 X-treme Total 7,492,500,00✔ 4,860,000,00 $ 15,025,500, b. If the company has an after-tax income goal of $2 billion and the tax rate is 50 percent, how many units of each type of scooter must be sold for the goal to be reached at the current sales mix? Units 3,090,000 x $ 5,150,000 x 2,060,000 x 10,300,000 $ 30 50 20 Dollars 6,798,000,00 * 19,055,000,00 * 12,360,000,00 38,213,000,0x c. Assume the sales mix shifts to 50 percent Mod, 40 percent Rad, and 10 percent X-treme. How does this change affect your answer to (a)? Note: Do not round until you determine the number of units of each product; round number of units to the next highest wh unit in your calculations.
Green Rider makes three types of electric scooters. The company's total fixed cost is $2,592,000,000. Selling prices, variable cost, and sales percentages for each type of scooter follow: Selling Price Variable Cost Percent of Total Unit Sales $2,200 $1,900 3,700 3,000 X-treme 6,000 5,000 a. What is Green Rider's break-even point in units and sales dollars? Mod Rad Mod Rad X-treme Total Mod Rad Units Dollars 1,215,000 $ 2,673,000,0 2,025,000 810,000 4,050,000 X-treme Total 7,492,500,00✔ 4,860,000,00 $ 15,025,500, b. If the company has an after-tax income goal of $2 billion and the tax rate is 50 percent, how many units of each type of scooter must be sold for the goal to be reached at the current sales mix? Units 3,090,000 x $ 5,150,000 x 2,060,000 x 10,300,000 $ 30 50 20 Dollars 6,798,000,00 * 19,055,000,00 * 12,360,000,00 38,213,000,0x c. Assume the sales mix shifts to 50 percent Mod, 40 percent Rad, and 10 percent X-treme. How does this change affect your answer to (a)? Note: Do not round until you determine the number of units of each product; round number of units to the next highest wh unit in your calculations.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Green Rider makes three types of electric scooters. The company's total fixed cost is $2,592,000,000. Selling prices, variable
cost, and sales percentages for each type of scooter follow:
Mod
Rad
X-treme
a. What is Green Rider's break-even point in units and sales dollars?
Units
Dollars
1,215,000 $ 2,673,000,0
2,025,000✔
7,492,500,00
810,000 ✓ 4,860,000,00✔
4,050,000 $ 15,025,500,✔
Mod
Rad
X-treme
Total
b. If the company has an after-tax income goal of $2 billion and the tax rate is 50 percent, how many units of each type of
scooter must be sold for the goal to be reached at the current sales mix?
Mod
Rad
X-treme
Total
Selling Price Variable Cost Percent of Total Unit Sales
$2,200
$1,900
30
3,700
3,000
50
6,000
5,000
20
Mod
Rad
X-treme
Total
Units
3,090,000 * $
5,150,000 x
2,060,000 x
10,300,000 x $
c. Assume the sales mix shifts to 50 percent Mod, 40 percent Rad, and 10 percent X-treme. How does this change affect your
answer to (a)?
Note: Do not round until you determine the number of units of each product; round number of units to the next highest whole
unit in your calculations.
Dollars
6,798,000,00 *
19,055,000,00 x
12,360,000,00 *
38,213,000,0 x
Units
2,445,278 x S
1,956,222 * $
489,056 * $
4,890,556 x S
Dollars
5,379,611,6 x
7,238,021,4 x
2,934,336,0 x
15,551,969, x
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