Question
CVP analysis -what if questions. sales mix ozark metal co. makes a single product that sells for $42 per unit. variable cost $27.30 per unit
CVP analysis -what if questions. sales mix ozark metal co. makes a single product that sells for $42 per unit. variable cost $27.30 per unit and fixed costs total $65,415.
required:
a. calculate the number the number of units must be sold each month for the firm to break even
b assume current sales are $220,000. calculate the margin of safety and the margin of safety ratio
c. calculate opoerating income if 5,000 units are sold in a month
d calculate operating income if the selling price is raised to $45 per unit, advertising expendictures are increased by $8,000per month., and monthly units sales vlolume becomes 5,400 units.
d. assume that the firm adds another product to its product line and that the new product sell for $20 per unit , has variable costs of $14 per unit and causes fixed expenses in total to increase to 83,000 per month. calculate the firms operating income if 5,000units of the original product and 4,000 units of the new product are sold each month. for the original product , use the selling price and variable cost data given in the problem statement.
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