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Accounting Question. Please help. #1 Preppy Co. makes and sells a single product. The current selling price is $47 per unit. Variable costs are $21
Accounting Question. Please help. #1 Preppy Co. makes and sells a single product. The current selling price is $47 per unit. Variable costs are $21 per unit and fixed expenses total $105,000 per month. Sales volume for July totaled 11,500 units. (a) Calculate the operating income for July. Use the Contribution Margin Format. (b) Calculate the break-even point in units sold and break-even total revenues. (c) Management is considering the use of automated production equipment. If this were done, variable costs would increase by $3.00 per unit, but fixed expenses would decrease by $15,000 per month. (1) Using the new cost structure, calculate operating income at a volume of 12,000 units per month Use the Contribution Margin Format. (2) Using the new cost structure, calculate the break-even point in units sold and break-even total revenues
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