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Cox Electric makes electronic components and has estimated the following for a new design of one of its products: Fixed Cost = $ 1 1
Cox Electric makes electronic components and has estimated the following for a new design of one of its products:
Fixed Cost $
Material cost per unit $
Labor cost per unit $
Revenue per unit $
Production Volume
Perunit material and labor cost together make up the variable cost per unit. Assuming that Cox Electric sells all it produces, build a spreadsheet model that calculates the profit by subtracting the fixed cost and total variable cost from total revenue, and answer the following questions.
a Construct a oneway data table with production volume as the column input and profit as the output. Breakeven occurs when profit goes from a negative to a positive value; that is breakeven is when total revenue total cost, yielding a profit of zero. Vary production volume from to in increments of In hich interval of production volume does breakeven occur? to units
b Use Goal Seek to find the exact breakeven point. Assign Set cell: equal to the location of profit, To value: and By changing cell: equal to the location of the production volume in your model.
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