East Publishing Company is doing an analysis of a proposed new finance text. Using the following data, answer parts a through e.

The company’s marginal tax rate is 40 percent.

a. Determine the company’s breakeven volume for this book.
•i. In units ii. In dollar sales

b. Develop a breakeven chart for the text.

c. Determine the number of copies East must sell in order to earn an (operating)
profit of $21,000 on this text.

d. Determine total (operating) profits at the following sales levels:
i. 3,000 units •ii. 5,000 units iii. 10,000 units

e. Suppose East feels that $30.00 is too high a price to charge for the new finance text. It has examined the competitive market and determined that $24.00 would be a better selling price. What would the breakeven volume be at this new selling price? P-9687