Question
Derby Phones is considering the introduction of a new model of headphones with the following price and cost characteristics. Sales price $ 350 per unit
Derby Phones is considering the introduction of a new model of headphones with the following price and cost characteristics.
| Sales price | $ | 350 | per unit |
| Variable costs | 90 | per unit | |
| Fixed costs | 650,000 | per month | |
Required:
a. What number must Derby sell per month to break even?
b. What number must Derby sell to make an operating profit of $364,000 for the month?
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Management Control Systems Performance Measurement Evaluation And Incentives
Authors: Kenneth Merchant, Wim Van Der Stede
3rd Edition
0273737619, 978-0273737612
