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Cost structure and product price of Chico garden tool company Investment (spent) $100,000 Other fixed overhead $10,000 R&D (spent) $120,000 Labor $3 per garden tool

Cost structure and product price of Chico garden tool company

Investment (spent)

$100,000

Other fixed overhead

$10,000

R&D (spent)

$120,000

Labor

$3 per garden tool (unit)

Traditional media advertising

$40,000

Materials

$2 per garden tool (unit)

Social media marketing

$30,000

Discount coupon

$1 per garden tool (unit)

Factory facility rental

$20,000

Selling price

$10 per garden tool (unit)

1.1) What is Unit contribution ($ per unit) of Chico garden tool companys garden tool?

1.2) Break-even volume of its garden tool?

1.3) Dollar break-even of its garden tool?

1.4) How many garden tools to sell to achieve a profit target of $50,000?

1.5) When discount coupon cost is increased to $2 per garden tool (unit), new break-even volume of garden tool with this $2 coupon (when other items stay unchanged)?

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