Ivan Indigo makes small phones. The estimated demand is between 9,000 and 20,000 units per month. The following table is the estimated costs at different levels of production. Selling Price $10.00 a b C Budgeted sales Direct materials Direct labor production overheads Fixed admin costs 9,000 12,000 15,000 20,000 $27,000 $36,000 $45,000 $60,000 $9,000 $12,000 $15,000 $20,000 $54,000 $60,000 $18,000 $18,000 $48,000 $18,000 Ivan wants to know The profit made at each level of production The break even point The fixed amount of production overheads The budget for 25,000 units of d production $70,000 $18,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Does it have two break-even points and how is this possible

a
b
C
Ivan Indigo makes small phones. The estimated demand is between 9,000 and 20,000 units per
month. The following table is the estimated costs at different levels of production.
Selling Price
$10.00
Budgeted sales
Direct materials
Direct labor
production overheads
Fixed admin costs
9,000
12,000
15,000
$27,000
$36,000 $45,000
$9,000 $12,000 $15,000
$48,000 $54,000 $60,000
$18,000
$18,000
$18,000
Ivan wants to know
The profit made at each level of production
The break even point
The fixed amount of production overheads
The budget for 25,000 units of
d production
20,000
$60,000
$20,000
$70,000
$18,000
Transcribed Image Text:a b C Ivan Indigo makes small phones. The estimated demand is between 9,000 and 20,000 units per month. The following table is the estimated costs at different levels of production. Selling Price $10.00 Budgeted sales Direct materials Direct labor production overheads Fixed admin costs 9,000 12,000 15,000 $27,000 $36,000 $45,000 $9,000 $12,000 $15,000 $48,000 $54,000 $60,000 $18,000 $18,000 $18,000 Ivan wants to know The profit made at each level of production The break even point The fixed amount of production overheads The budget for 25,000 units of d production 20,000 $60,000 $20,000 $70,000 $18,000
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