$[115\mathrm{.}27.$ Multiple$-$Level Break$-$Even Analysis

Kucera Associates provides marketing services for a number of small manufacturing firms. Kucera receives a commission of $10\%$ of sales. Operating costs are as follows:

Unit$-$level costs.

Sales$-$level costs.

$q,$ $$0\mathrm{.}05$ per sales dollar

Customer$-$level costs $$400$ per sales order

Facility$-$level costs

$q,$ $$1,000$ per customer per yezz $$75,000$ per year

REQUIRED

a$.$ Determine the minimum order size in sales dollars for Kucera to break even on an order,

b$.$ Assuming an average customer places five orders per year, determine the minimum annust sales required to break even on a customer.

c$.$ What is the average order size in $(b)?$

d$.$ Assuming Kucera currently serves $100$ customers, with each placing an average of five orders per year, determine the minimum annual sales required to break even.

$e.$ What is the average order size in $(d)?$

f$.$ Explain the differences in the answers to $(a),(c),$ and $(e).$

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