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Carla Vista Manufacturing Ltd . has provided you with the following CVP income statement: Management is considering the following course of action to increase operating
Carla Vista Manufacturing Ltd has provided you with the following CVP income statement:
Management is considering the following course of action to increase operating income: reduce the selling price by with no
changes to unit variable costs or fixed costs. Management feels that this change will increase unit sales by
Calculate the breakeven point in units and sales dollars with no change in sales. Round contribution margin ratio to decimal
places, eg Round units to decimal places, eg and dollar amount to decimal places, eg Calculate the breakeven point in units and sales dollars with the proposed change in sales price. Round units to decimal places, eg and dollar amount to decimal places, eg
In units
In dollars
Breakeven point
$
Should management go forward with the reduction in sales price?
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