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Edward Stevens is evaluating a business opportunity to sell cookware at trade shows. Mr. Stevens can buy the cookware at a wholesale cost of $220

Edward Stevens is evaluating a business opportunity to sell cookware at trade shows. Mr. Stevens can buy the cookware at a wholesale cost of $220 per set. He plans to sell the cookware for $370 per set. He estimates fixed costs such as plane fare, booth rental cost, and lodging to be $5,700 per trade show.

A Determine the number of cookware sets Mr. Stevens must sell at a trade show to break even (zero profit or loss). Use the following structure to answer this question:

  1. Determine the amount of the contribution margin per unit.
  2. Calculate the break-even point in units.
  3. Calculate the break-even point in sales dollars.

B Assume Mr. Stevens desires to earn a profit of $5,100 per show.

  1. Determine the sales volume in units (sets of cookware) necessary to earn the desired profit.
  2. Determine the sales volume in dollars necessary to earn the desired profit.

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