Question
1. The Lakeland Symphony would like to perform for a neighboring city. Fixed costs for the performance total of $5,250. Tickets will sell for $15.75
1. The Lakeland Symphony would like to perform for a neighboring city. Fixed costs for the performance total of $5,250. Tickets will sell for $15.75 per person, and an outside organization responsible for processing ticket orders charges the symphony a fee of $2.10 per ticket. The Lakeland Symphony expects to sell 500 tickets.
A. How many tickets must the Lakeland Symphony sell to break even?
B. How many tickets must the symphony sell to earn a profit of $7,350?
C. How much must the Lakeland Symphony have in sales dollars to break even?
D. How much must the Lakeland Symphony have in sales dollars to earn a profit of $7,350?
E. What is the symphony's margin of safety in units and in sales dollars?
2.
MacFarlane Printer Machines (MPM) builds three computer printer models: Inkjet, Laser, and Color Laser. Information for these three products is as follows:
| Inkjet | Laser | Color Laser | Total |
---|---|---|---|---|
Selling price per unit | $255 | $420 | $1,680 |
|
Variable cost per unit | $105 | $158 | $840 |
|
Expected unit sales (annual) | 12,600 | 6,300 | 2,100 | 21,000 |
Sales mix | 60% | 30% | 10% | 100% |
Total annual fixed costs are $5,250,000. Assume that the sales mix remains the same at all levels of sales.
A. How many printers in total must be sold to break even?
B. How many units of each printer must be sold to break even?
C. How many printers in total must be sold to earn an annual profit of $1,000,000?
D. How many units of each printer must be sold to earn an annual profit of $1,000,000?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started