Question
Corrientes Company produces a single product in its Buenos Airs plant that currently sell for 6.60p per unit. Fixed cost are expected to amount to
Corrientes Company produces a single product in its Buenos Airs plant that currently sell for 6.60p per unit. Fixed cost are expected to amount to 56,000p for the year, and all variable manufacturing and administrative cost are expected to be incurred at a arate of 2.30p per unit. Corrientes has two salespeople who are paind strictly on a commission basis. Their commission is 9 percent of the sales revenue they generate (ignore income taxes)(p denotes the peso ) (Argentinas peso on this day is worth .104 US dollar)
1. Suppose management alters its current plans by spending an additional amount of 3,900p on advertising and increases the selling price to 7.60p per unit. Calculate the profit on 66,000 units. (do not round intermediate calculations. Enter your answers in pesos)
2. The Sorde Company has just approached Corrientes to make a special one time purchase of 15,000 units. These units would not be sold by the sales personnel, and therefore, no commission would have to be paid. What is the price Correintes would have to charge per unit on the special order to earn additional profit of 36,000p? (round your answer to 2 decimal places. Enter answer in pesos.
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