PRICE VARIABLE COST CONTRIBUTION MARGIN NUMBER OF UNITS If required, round your final answers to nearest whole value. 40 70 30 42 10 28 1000 500 1. Compute the number of vases and the number of figurines that must be sold for the company to break even. BREAKEVEN VASES, BREAKEVENFIGURINES 2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260 per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales will increase to 1,000 units. What is the new break-even point in units for each of the products?
PRICE VARIABLE COST CONTRIBUTION MARGIN NUMBER OF UNITS If required, round your final answers to nearest whole value. 40 70 30 42 10 28 1000 500 1. Compute the number of vases and the number of figurines that must be sold for the company to break even. BREAKEVEN VASES, BREAKEVENFIGURINES 2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260 per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales will increase to 1,000 units. What is the new break-even point in units for each of the products?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Parker Pottery produces a line of vases and a line of ceramic figurines. Each line uses the same equipment and labor;
hence, there are no traceable fixed costs. Common fixed cost equals $50,000. Parker's accountant has begun to assess
the profitability of the two lines and has gathered the following data for last year:
PRICE
VARIABLE COST
CONTRIBUTION MARGIN
NUMBER OF UNITS
If required, round your final answers to nearest whole value.
VASES
FIGURINES
40
70
30
42
10
28
1000
500
1. Compute the number of vases and the number of figurines that must be sold for the company to break even.
BREAKEVEN VASES, BREAKEVEN FIGURINES
2. Parker Pottery is considering upgrading its factory to improve the quality of its products. The upgrade will add $5,260
per year to total fixed cost. If the upgrade is successful, the projected sales of vases will be 1,500, and figurine sales will
increase to 1,000 units. What is the new break-even point in units for each of the products?
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