Klyne Corporation manufactures pharmaceutical products that are sold through a network of sales agents. The agents are paid a commission of 18% of sales. The income statement for the year ending December 31, 2020, is as follows: Sales Cost of goods sold i Variable. KLYNE CORPORATION Income Statement For the Year Ending December 31, 2020 Fixed Gross margin Selling and marketing expenses Commissions Fixed costs Operating income Break-even point $14,850,000 3,009,580 5,940,000 3,700,000 Break-even point $ 33,000,000 17,859,580 15,140,420 Klyne is considering hiring its own sales staff to replace the network of agents. Klyne will pay its salespeople a commission of 10% and incur fixed costs of $2,080,000. 9,640,000 $ 5,500,420 Required: 1. Calculate Klyne Corporation's break-even point in sales dollars for the year 2020. (Round your answer to 2 decimal places.) 2. Calculate Klyne Corporation's break-even point in sales dollars for the year 2020 if the company had hired its own sales force to replace the network of agents. (Round your answer to 2 decimal places.)

Klyne Corporation manufactures pharmaceutical products that are sold through a network of sales agents. The agents are paid a commission of 18% of sales. The income statement for the year ending December 31, 2020, is as follows: Sales Cost of goods sold i Variable. KLYNE CORPORATION Income Statement For the Year Ending December 31, 2020 Fixed Gross margin Selling and marketing expenses Commissions Fixed costs Operating income Break-even point $14,850,000 3,009,580 5,940,000 3,700,000 Break-even point $ 33,000,000 17,859,580 15,140,420 Klyne is considering hiring its own sales staff to replace the network of agents. Klyne will pay its salespeople a commission of 10% and incur fixed costs of $2,080,000. 9,640,000 $ 5,500,420 Required: 1. Calculate Klyne Corporation's break-even point in sales dollars for the year 2020. (Round your answer to 2 decimal places.) 2. Calculate Klyne Corporation's break-even point in sales dollars for the year 2020 if the company had hired its own sales force to replace the network of agents. (Round your answer to 2 decimal places.)

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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