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Crane Corp's sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed
Crane Corp's sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 505.500 units of product: sales $2,527,500, total costs and expenses $2,622,000, and net loss $94,500. Costs and expenses consisted of the amounts shown below. Total Cost of goods sold $2,156,940 Variable $1,658,040 Fixed $498,900 Selling expenses 252,750 93,012 159,738 Administrative expenses 212,310 68,748 143,562 $2,622,000 $1,819,800 $802,200 Management is considering the following independent alternatives for 2021. 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 $151,650 to total salaries of $60,660 plus a 4% commission on sales. (a) Compute the break-even point in dollars for 2020. Break-even noint
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