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12 Problem 3SP (Break Even point and selling price) Simple metals inc. will manufacture and sell 300,000 units next year. Fixed costs will total $350,000,
12 Problem 3SP
(Break Even point and selling price) Simple metals inc. will manufacture and sell 300,000 units next year. Fixed costs will total $350,000, and variable costs will be 65% of sales.
a) The firm wants to receive a level of earnings before interest and taxes of $250,000. What selling price per unit is necessary to achieve this result?
b) Set up a proforma income statement to verify your solution for part (a).
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