. Preparing a break-even analysis; forecasting net income or net loss. The Burke Corporation produces one product,...
Question:
. Preparing a break-even analysis; forecasting net income or net loss. The Burke Corporation produces one product, which is sold at a fixed price of $10 per unit. For the year 19X1, the company operated at full capacity anda total of 100,000 units were sold. The company’s fixed costs totaled $300,000 and the variable costs for the year were $500,000.
Instructions 1. Compute the company’s break-even sales in units and in dollars.
2. Prepare a simple break-even chart.
3. How many units must be sold to make a net income of $120,000?
4. Assume that the company has forecast a net loss of $20,000 in 19X2. If all the other data given are correct, how many units are forecast to be sold in 19X2?
Step by Step Answer:
Cost Accounting Principles And Applications
ISBN: 9780070081529
5th Edition
Authors: Horace R. Brock