Zephyr Electronics sells high-end speakers. The unit selling price is $110, the unit variable costs are $52.50, fixed costs are $200,000, and current sales are 14,000 units. How much will operating income change if sales increase by 6,000 units?
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Zephyr Electronics sells high-end speakers. The unit selling price is $110, the unit variable costs are $52.50, fixed costs are $200,000, and current sales are 14,000 units. How much will operating income change if sales increase by 6,000 units?

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- Grove Audio is considering the introduction of a new model of wireless speakers with the following price and cost characteristics. Sales price $ 438.00 per unit Variable costs 198.00 per unit Fixed costs 680,000 per year Assume that the projected number of units sold for the year is 4,150. Consider requirements (b), (c), and (d) independently of each other. Required: What will the operating profit be? What is the impact on operating profit if the sales price decreases by 20 percent? Increases by 10 percent? What is the impact on operating profit if variable costs per unit decrease by 10 percent? Increase by 20 percent? Suppose that fixed costs for the year are 20 percent lower than projected, and variable costs per unit are 10 percent higher than projected. What impact will these cost changes have on operating profit for the year? Will profit go up? Down? By how much? omplete this question by entering your answers in the tabs below. Required A Required B…Grove Audio is considering the introduction of a new model of wireless speakers with the following price and cost characteristics. Sales price $ 433.00 per unit Variable costs 193.00 per unit Fixed costs 645,000 per year Assume that the projected number of units sold for the year is 3,900. Consider requirements (b), (c), and (d) independently of each other. Questions: What will the operating profit be? What is the impact on operating profit if the sales price decreases by 20 percent? Increases by 10 percent? What is the impact on operating profit if variable costs per unit decrease by 10 percent? Increase by 20 percent? Suppose that fixed costs for the year are 20 percent lower than projected, and variable costs per unit are 10 percent higher than projected. What impact will these cost changes have on operating profit for the year? Will profit go up? Down? By how much?Suppose executives estimate that the unit variable cost for their DVD recorder is $100, the fixed cost related to the product is $10 million annually, and the target volume for next year is 100,000 recorders. What sales price will be necessary to achieve a target profit of $l million?

