Reflex Manufacturing Corp. manufactures composters at a unit variable cost of $43. It sells them for $70 each. It can produce a maximum of 3200 composters per month. Annual fixed costs total $648,000.
a. What is the break-even volume per month?
b. What is the monthly net income at a volume of 2500 units per month?
c. What is the monthly net income if Reflex operates at 50% of capacity during a recession?
d. At what percent utilization would the annual net income be $226,800?
e. If fixed and variable costs remain the same, how much do the monthly break-even unit sales change for a $1 increase in the selling price?