Question
Daily Companys current fixed costs are $430,000 and current variable cost per unit is $70. The current selling price is $92 per unit. a. What
Daily Companys current fixed costs are $430,000 and current variable cost per unit is $70. The current selling price is $92 per unit.
a. What is the company's current contribution margin? Round your answer to the nearest cent (2 decimal places).
b. What is the company's current contribution margin ratio? Round your answer to 2 decimal places and include a percentage (%) sign.
c. What is the company's current break-even point in units? Round your answer to the nearest whole unit (no decimal places).
d. What is the company's current break-even point in sales dollars? Round your answer to the nearest cent (2 decimal places).
Daily Company is now considering a new product enhancement that will increase fixed costs by $30,000 from their current level, variable costs by $15 a unit from their current level, and increase the selling price by $35 from its current level.
e. What would be the company's new contribution margin? Round your answer to the nearest cent (2 decimal places).
f. What would be the company's new contribution margin ratio? Round your answer to 2 decimal places and include a percentage (%) sign.
g. What would be the company's new break-even point in units? Round your answer to the nearest whole unit (no decimal places).
h. What would be the company's new break-even point in sales dollars? Round your answer to the nearest cent (2 decimal places).
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started