How many T-shirts must the company sell this year to break even? (Use the rounded contribution margin per unit calculated in the previous part to calculate Breakeven units. Round Breakeven units to 0 decimal places, e.g. 25,000.) W Promotions sells T-shirts imprinted with high school names and logos. Last year the shirts sold for $20.00 each, and variable costs were $8.50 per shirt. At this cost structure, the breakeven point was 24,600 shirts. However, the company actually earned $24,840 in net income. This year, the company is increasing its price to $22 per shirt. Variable costs per shirt will increase by 20%, and fixed expenses will increase by $30,980. The tax rate will remain at 40%.
Unitary Method
The word “unitary” comes from the word “unit”, which means a single and complete entity. In this method, we find the value of a unit product from the given number of products, and then we solve for the other number of products.
Speed, Time, and Distance
Imagine you and 3 of your friends are planning to go to the playground at 6 in the evening. Your house is one mile away from the playground and one of your friends named Jim must start at 5 pm to reach the playground by walk. The other two friends are 3 miles away.
Profit and Loss
The amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item.
Units and Measurements
Measurements and comparisons are the foundation of science and engineering. We, therefore, need rules that tell us how things are measured and compared. For these measurements and comparisons, we perform certain experiments, and we will need the experiments to set up the devices.
How many T-shirts must the company sell this year to break even? (Use the rounded contribution margin per unit calculated in the previous part to calculate Breakeven units. Round Breakeven units to 0 decimal places, e.g. 25,000.)
W Promotions sells T-shirts imprinted with high school names and logos. Last year the shirts sold for $20.00 each, and variable costs were $8.50 per shirt. At this cost structure, the breakeven point was 24,600 shirts. However, the company actually earned $24,840 in net income.
This year, the company is increasing its price to $22 per shirt. Variable costs per shirt will increase by 20%, and fixed expenses will increase by $30,980. The tax rate will remain at 40%.
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