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I am struggling with requirement 3 and 4. Outback Outfitters sells recreational equipment. One of the compony's proctucts, a small camp stove, selis for $100
I am struggling with requirement 3 and 4.
Outback Outfitters sells recreational equipment. One of the compony's proctucts, a small camp stove, selis for $100 per unit Variable expenses are $70 per stove, and fixed expenses associated with the stove total $135,000 per month Required: 1. What is the break-even point in unit sales and in dollar sales? 2. If the variable expenses per stove increase as a percentage of the selling price, will it result in a higher or a lower break-ever point? (Assume that the fixed expenses remain unchanged.) 3. At present, the company is selling 12,000 stoves per month. The sales manager is convinced that a 108s reduction in the seling price would result in a 25% increase in monthly sales of stoves. Prepare two contribution format income statements. one under. present operating conditions, and one as operations would appear after the proposed changes. 4 Refer to the data in Required 3. How many stoves would have to be sold at the new selling price to attain a target profit of $75 oo per month? Complete this question by entering your answers in the tabs below. What is the break-even point in unit sales and in dollar sales Step by Step Solution
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