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Cost/Volume/Profit Analysis Question: Bandersnatch Company makes Jabberwockies. Each Jabberwocky requires $1,000 in Direct Materials and $500 of Direct Labor. Fixed costs (including Research and Development)

  1. Cost/Volume/Profit Analysis

Question: Bandersnatch Company makes Jabberwockies. Each Jabberwocky requires $1,000 in Direct Materials and $500 of Direct Labor. Fixed costs (including Research and Development) total $132,000 per month. Each Jabberwocky sells for $24,000.

A. How many Jabberwockies does Bandersnatch need to produce and sell each month to break even?

B. How many Jabberwockies does Bandersnatch need to produce and sell each month to achieve a before-tax profit of $1,000,000?

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