Premium Beds is a retailer of luxury bed frames located in Los Angeles, California. Due to a recent industry-wide financial crisis, the CFO of Premium Beds fears a significant drop in the firm's upcoming income stream. The CFO asked you to use the company financial information provided below. Sales price per unit $ 3,000.00 Per-unit variable costs: Invoice cost 2,218.80 Sales commissions 281.20 Total per-unit variable costs $ 2,500.00 Total annual fixed costs: Advertising $ 236,000 Rent 178,000 Salaries 386,000 Total annual fixed costs $ 800,000 The annual breakeven point in dollars is: $4,800,000. $4,500,000. $4,100,000. $4,600,000. $4,300,000.
Premium Beds is a retailer of luxury bed frames located in Los Angeles, California. Due to a recent industry-wide financial crisis, the CFO of Premium Beds fears a significant drop in the firm's upcoming income stream. The CFO asked you to use the company financial information provided below. Sales price per unit $ 3,000.00 Per-unit variable costs: Invoice cost 2,218.80 Sales commissions 281.20 Total per-unit variable costs $ 2,500.00 Total annual fixed costs: Advertising $ 236,000 Rent 178,000 Salaries 386,000 Total annual fixed costs $ 800,000 The annual breakeven point in dollars is: $4,800,000. $4,500,000. $4,100,000. $4,600,000. $4,300,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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- Premium Beds is a retailer of luxury bed frames located in Los Angeles, California. Due to a recent industry-wide financial crisis, the CFO of Premium Beds fears a significant drop in the firm's upcoming income stream. The CFO asked you to use the company financial information provided below.
Sales price per unit
$
3,000.00
Per-unit variable costs:
Invoice cost
2,218.80
Sales commissions
281.20
Total per-unit variable costs
$
2,500.00
Total annual fixed costs:
Advertising
$
236,000
Rent
178,000
Salaries
386,000
Total annual fixed costs
$
800,000
The annual breakeven point in dollars is:$4,800,000.
$4,500,000.
$4,100,000.
$4,600,000.
$4,300,000.
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