Rossiter Fittings produces two models of pipe fittings for underwater lines. The two models (RF-12 and RF-25) have the following characteristics, as developed by a product cost analyst RF-12 $ 387 $ 307 3,483 Selling price per unit Variable cost per unit Expected units sold per year The total fixed costs per year for the company are $1,118,960. RF-25 $ 527 $367 11,997 Required: a. What is the anticipated level of profits for the expected sales volumes? b. Assuming that the product mix is the same at the break-even point, compute the break-even point in units. c. The head of marketing agrees with the data provided by the cost analyst but believes that the sales of the RF-12 model will be double in units from what the cost analyst predicts. The head of marketing agrees that the total unit volume is likely to be as predicted by the cost analyst. What would be the break-even point of sales in units using the assumptions of the head of marketing?

Rossiter Fittings produces two models of pipe fittings for underwater lines. The two models (RF-12 and RF-25) have the following characteristics, as developed by a product cost analyst RF-12 $ 387 $ 307 3,483 Selling price per unit Variable cost per unit Expected units sold per year The total fixed costs per year for the company are $1,118,960. RF-25 $ 527 $367 11,997 Required: a. What is the anticipated level of profits for the expected sales volumes? b. Assuming that the product mix is the same at the break-even point, compute the break-even point in units. c. The head of marketing agrees with the data provided by the cost analyst but believes that the sales of the RF-12 model will be double in units from what the cost analyst predicts. The head of marketing agrees that the total unit volume is likely to be as predicted by the cost analyst. What would be the break-even point of sales in units using the assumptions of the head of marketing?

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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