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CVP analysis, international differences in cost structure. Knitwear, |nc., analyzes three countries to decide where to install its only factory that will make a new
CVP analysis, international differences in cost structure. Knitwear, |nc., analyzes three countries to decide where to install its only factory that will make a new sweater model: Singapore, Thailand and the United States. All readymade sweaters are to be sold to merchants Win the United States at a unit price of$ 32. These traders will in turn apply a surcharge own commercial when they will sell the sweaters to the final customers. There are differences in terms between the three countries fixed costs and variable costs per sweater, as follows: Variable cost of production per sweater Variable cost of marketing & Annual fixed costs distribution on the sweater Country Singapore 6.5 million 5 8.005 11.005 Thailand 4.5 million 5 5.505 11.505 United States 12,0 million S 13.00$ 9.005; Request: 1. Calculate the breakeven point of Knitwear, Inc., for each country, expressed in: {a} number of units sold and {b} revenue. 2. If Knitwear Inc. sells 800,000 sweaters in 2002, what will be the operating profit budgeted for every country? Comment on the results obtained
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