Refer to the original data, assume that the company is thinking to slash the variable cost per unit $5 and increasing fixed cost by $40,000. If this change is made, what will be the break-even point in unit sales and dollar sales. Refer to the original data, assume that next month, to help offset anticipated future decrease in no of customer, the company hires an employee who will be wearing a cartoon character costume I front of the store, that will increase fixed expanse by $4,000. Assume that this would increase the current monthly sales from 300 units to 340 units. Would company’s total profit change? By how much?
Refer to the original data, assume that the company is thinking to slash the variable cost per unit $5 and increasing fixed cost by $40,000. If this change is made, what will be the break-even point in unit sales and dollar sales. Refer to the original data, assume that next month, to help offset anticipated future decrease in no of customer, the company hires an employee who will be wearing a cartoon character costume I front of the store, that will increase fixed expanse by $4,000. Assume that this would increase the current monthly sales from 300 units to 340 units. Would company’s total profit change? By how much?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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- Refer to the original data, assume that the company is thinking to slash the variable cost per unit $5 and increasing fixed cost by $40,000. If this change is made, what will be the break-even point in unit sales and dollar sales.
- Refer to the original data, assume that next month, to help offset anticipated future decrease in no of customer, the company hires an employee who will be wearing a cartoon character costume I front of the store, that will increase fixed expanse by $4,000. Assume that this would increase the current monthly sales from 300 units to 340 units. Would company’s total profit change? By how much?
Transcribed Image Text:Question 2: XYZ company produces lucrative toys for kids. The following data relates to XYZ company.
Sales revenues (300 Q)
$60,000; Variable costs $15,000; Contribution margin $45,000;
Fixed Costs $9,000; Net operating Income
$36,000
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