Alpine Motors, Inc., employs 25 sales personnel to market its line of luxury automobiles. The average car

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Alpine Motors, Inc., employs 25 sales personnel to market its line of luxury automobiles.

The average car sells for $56,000, and a 6% commission is paid to the salesperson. Alpine Motors is considering a change to the commission arrangement where the company would pay each salesperson a salary of $2,200 per month plus a commission of 2% of the sales made by that salesperson. What is the amount of total monthly car sales at which Alpine Motors would be indifferent as to which plan to select? (CMA adapted)

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Cost Management Accounting And Control

ISBN: 9780324002324

3rd Edition

Authors: Don R. Hansen, Maryanne M. Mowen

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