Stone Corporation is a manufacturing company that makes small electric motors it sells for $45 per unit.

Question:

Stone is a manufacturing company that makes small electric motors it sells for $45 per unit.
The variable costs of production are $25 per motor, and annual fixed costs of production are $800,000.
Required
a. How many units of product must Stone make and sell to break even?
b. How many units of product must Stone make and sell to earn a $120,000 profit?
c. The marketing manager believes that sales would increase dramatically if the price were reduced to $40 per unit. How many units of product must Stone make and sell to earn a $160,000 profit, if the sales price is set at $40 per unit?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...