CollegePak Company produced and sold 73,000 backpacks during the year just ended at an average price...
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CollegePak Company produced and sold 73,000 backpacks during the year just ended at an average price of $33 per unit. Va manufacturing costs were $13.50 per unit, and variable marketing costs were $4.32 per unit sold. Fixed costs amounted to $54 for manufacturing and $218,400 for marketing. There was no year-end work-in-process inventory. (Ignore income taxes.) Required: 1. Compute CollegePak's break-even point in sales dollars for the year. Note: Do not round intermediate calculations. Round your final answer up to the nearest whole dollar. 2. Compute the number of sales units required to earn a net income of $555,000 during the year. Note: Do not round intermediate calculations. Round your final answer up to the nearest whole number. 3. CollegePak's variable manufacturing costs are expected to increase by 10 percent in the coming year. Compute the firm's bre even point in sales dollars for the coming year. Note: Do not round your intermediate calculations. Round your final answer up to the nearest whole dollar. 4. If CollegePak's variable manufacturing costs do increase by 10 percent, compute the selling price that would yield the same contribution-margin ratio in the coming year. Note: Do not round intermediate calculations. Round your final answer to two decimal places. CollegePak Company produced and sold 73,000 backpacks during the year just ended at an average price of $33 per unit. Va manufacturing costs were $13.50 per unit, and variable marketing costs were $4.32 per unit sold. Fixed costs amounted to $54 for manufacturing and $218,400 for marketing. There was no year-end work-in-process inventory. (Ignore income taxes.) Required: 1. Compute CollegePak's break-even point in sales dollars for the year. Note: Do not round intermediate calculations. Round your final answer up to the nearest whole dollar. 2. Compute the number of sales units required to earn a net income of $555,000 during the year. Note: Do not round intermediate calculations. Round your final answer up to the nearest whole number. 3. CollegePak's variable manufacturing costs are expected to increase by 10 percent in the coming year. Compute the firm's bre even point in sales dollars for the coming year. Note: Do not round your intermediate calculations. Round your final answer up to the nearest whole dollar. 4. If CollegePak's variable manufacturing costs do increase by 10 percent, compute the selling price that would yield the same contribution-margin ratio in the coming year. Note: Do not round intermediate calculations. Round your final answer to two decimal places.
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1 To compute CollegePaks breakeven point in sales dollars for the year we need to use the formula Breakeven point in sales dollars Fixed costs Contrib... View the full answer
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