Question
Glade, Inc. is trying to decide a commission-based pay plan for its salespeople. Currently, Glade has five salespeople and they sell units that sell for
Glade, Inc. is trying to decide a commission-based pay plan for its salespeople. Currently, Glade has five salespeople and they sell units that sell for $100 each. The company is considering a plan in which each salesperson would earn an annual salary of $20,100, plus commissions of 12% of the sales price for each unit sold by that salesperson. Glade's other fixed costs, NOT including the salespeoples salaries, total $585,000. Glade's other variable costs, NOT including commissions, total $20 per unit. What would the break-even point in units be under this pay plan?
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