Chapter 11, Problem 11.17E

To determine

(a)

Concept introduction:

The maximum operating loss means the minimum level of profit that company can achieve with respect to maximum sale.

To compute:

The maximum operating loss.

To determine

(b)

Concept introduction:

The maximum operating income means the maximum level of profit that company can achieve with respect to maximum sale.

To compute:

The maximum operating income.

To determine

(c)

Concept introduction:

The Profit Volume Graph is a graph Representation that shows the impact of sale volume on the operating profit. It shows maximum and minimum operating income or loss that company can earn with these sale volume.

To construct:

The profit Volume Graph.

To determine

(d)

Concept introduction:

The Break even sale is that point of sale where company recovers all fixed cost.

The break even sale in units