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Annual sales volume Unit selling price Variable expense per unit Velcro 106,000 $1.99 $0.90 Metal 207,000 $1.30 $0.89 Nylon 316,000 $1.60 $1.10 Total fixed expenses
Annual sales volume Unit selling price Variable expense per unit Velcro 106,000 $1.99 $0.90 Metal 207,000 $1.30 $0.89 Nylon 316,000 $1.60 $1.10 Total fixed expenses are $256.000 per year. All three products are sold in highly competitive markets, so the company is unable to raise prices without losing an unacceptable numbers of customers. The company has an extremely effective lean production system, so there are no beginning or ending work in process or finished goods inventories, inces Required: 1. What is the company's over-all break-even point in dollar sales? 2. Of the total fixed expenses of $256.000, $23,400 could be avoided if the Velcro product is dropped. $77,500 if the Metal product is dropped, and $96.500 if the Nylon product is dropped. The remaining fixed expenses of $58,600 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely a. What is the break-even point in unit sales for each product? b. If the company sells exactly the break-even quantity of each product, what will be the overall profit of the company? Pie eme reac Required i Required 2A Required 2B What is the company's over-all break-even point in dollar sales? (Round CM ratio to nearest thousand dollars.) Break-even point in dollar sales Required 1 Required 2A Required 2B of the total fixed expenses of $256,000, $23,400 could be avoided if the Velcro product is dropped, $77,500 If the Metal product is dropped, and 596,500 if the Nylon product is dropped. The remaining fixed expenses of $58,600 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. What is the break-even point in unit sales for each product? (Do not round intermediate calculations.) Show less Velcro Metal Nylon Break-even point in unit sales Required 1 Required 2A Required 2B of the total fixed expenses of $256,000, $23,400 could be avoided if the Velcro product is dropped, $77,500 If the Metal product is dropped, and 596,500 if the Nylon product is dropped. The remaining fixed expenses of $58,600 consist of common fixed expenses such as administrative salaries and rent on the factory building that could be avoided only by going out of business entirely. If the company sells exactly the break-even quantity of each product, what will be the overall profit of the company? Show less
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