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Compute break-even point under Iternative courses of action. P18.4A (LO 4), E Tanek Corp.'s sales slumped badly in 2022. For the first time in its
Compute break-even point under Iternative courses of action. P18.4A (LO 4), E Tanek Corp.'s sales slumped badly in 2022. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 500,000 units of product: sales $2,500,000, total costs and expenses $2,600,000, and net loss $100,000. Costs and expenses consisted of the amounts shown below. Total Variable Fixed Cost of goods sold Selling expenses Administrative expenses $2.140.000 250.000 210,000 $1,590,000 92.000 68,000 $550.000 158,000 142,000 $850,000 $2,600,000 $1,750,000 Management is considering the following independent alternatives for 2023. 1. Increase unit selling price 20% with no change in costs, expenses, and sales volume 2. Change the compensation of salespersons from fixed annual salaries totaling $150,000 to total sala- ries of $60.000 plus a 5% commission on sales. Instructions a. Compute the break-even point in dollars for 2023. b. Compute the break-even point in dollars under each of the alternative courses of action. (Round all ratios to nearest full percent.) Which course of action do you recommend? - Alternative 1 $2,023,810
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