Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1- Total fixed cost of a carpet manufacturing company is $280000. Variable cost per carpet is $80, and unit selling price of the carpet

image text in transcribedimage text in transcribed

1- Total fixed cost of a carpet manufacturing company is $280000. Variable cost per carpet is $80, and unit selling price of the carpet is $150. a- How many carpets must the business sell to be at the breakeven point? b- What is the company's sales revenue at breakeven point? c- If management wants to earn a profit of $350000, how many carpets must the company sell? d- Suppose that total fixed cost of the company increase by $40000 variable cost per carpet doesn't change selling price per carpet doesn't change Company sold 600 carpets in both cases Compare the contribution margin of two cases? (does it increase or decrease?) e- Suppose that variable cost per carpet increase by $10 total fixed cost of the company increase by $20000 selling price per carpet doesn't change Company sold 700 carpets How much would the company's sales profit be in new case? f- Suppose that total fixed cost increase by 50%. variable cost per carpet increase by 50% selling price per carpet increase by 50% Company sold 2000 carpets in both cases Compare the contribution margin of two cases

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Intermediate Accounting

Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield

16th edition

1118742974, 978-1118743201, 1118743202, 978-1118742976

More Books

Students also viewed these Accounting questions

Question

Briefly discuss Aristotles approach to dreaming.

Answered: 1 week ago