Question
3. (5 POINTS) Javed Ahmed intend to open a new business to supply a nationally known line of shoes. He found a good location in
3. (5 POINTS) Javed Ahmed intend to open a new business to supply a nationally known line of shoes. He found a good location in Olaya to open his shop, and have determined that the average prices and costs of operating the store are: Selling Price = SAR 50 per pair Variable Cost = SAR 30 per pair Rent = SAR 5000 per month Insurance = SAR 700 per month Utilities & Telephone = SAR 300 per month In addition, he plan to hire two sales women on a commission basis of 10% in order to provide them with incentive to sell shoes. You are required determine the breakeven point in SAR? REQUIRED: a. Total fixed cost ( 1.5 pts) b. Total variable cost ( 1.5 pts) c. Break even in SAR ( 1pts) d. Break even in units ( 1 pts).
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