A8 please help.... Minden Company Introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggestthat the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company's present selling price is$66 per unit, and variable expenses are $40 per unit. Fixed expenses are $520,000 per year. The present annual sales volume (at the$66 selling price) is 17,500 units.Required:1. What is the present yearly operating Income or loss?Note: A loss amount should be input with a minus sign.2. What is the present break-even point in unit sales and In dollar sales?Note: Round Intermediate calculations and final answers to the nearest whole number.Break-even point in unit salesBreak-even point in dollar sales3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many unitsand at what selling price per unit would the company generate this profit?Maximum profitNumber of unitsSelling price per unit

Reference: Schmidt, J. (2023b, December 4). Break Even Analysis. Corporate Finance Institute.…

Answered: Minden Company Introduced a new product…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 40P

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Minden Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $2 reduction in the selling price. The company’s present selling price is $95 per unit, and variable expenses are $65 per unit. Fixed expenses are $835,800 per year. The present annual sales volume (at the $95 selling price) is 25,900 units. 3. Assuming that the marketing studies are correct, what is the maximum annual profit that the company can earn? At how many units and at what selling price per unit would the company generate this profit? 4. What would be the break-even point in unit sales and in dollar sales using the selling price you determined in (3) above (e.g., the selling price at the level of maximum profits)
R. Fong Company introduced a new product last year for which it is trying to find an optimal selling price. Marketing studies suggest that the company can increase sales by 5,000 units for each $ 2 reduction in the selling price. The company's present selling price is $ 70 per unit, and variable expenses are $ 40 per unit. Fixed expenses are $ 540,000 per year. The present annual sales volume (at the $70 selling price) is 15,000 units. Assuming that the marketing studies are correct, what will be the optimal selling price that will give the maximum profit for the company? the optimal selling price is set, how many units are expected to be sold?
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APQ Company currently sells a piece of equipment for $150 per unit. It plans on lowering the price of the unit to $119 per unit. The cost of goods for each unit is consistent each year, at $52 per unit. The company expects to sell 100,000 units in the current year. Suppose that if APQ drops the price on the equipment immediately, it can increase sales over the next year by 30% to 130,000 units. Will this price decrease have a positive or negative impact on the company's EBIT? What will be the dollar value of the incremental impact of this price drop on the firm's EBIT? Will this have a positive or negative impact on the EBIT for the company? What will the dollar value of the incremental impact of the price drop be for the company? (Enter a negative for a loss, positive for a gain; round your answer to the nearest whole dollar.)

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