Question
II [10 pts] For these three products, what is the gross margin per unit, and the break-even volume in units? Product Price/unit Var cost/unit Fixed
II [10 pts] For these three products, what is the gross margin per unit, and the break-even volume in units?
Product Price/unit Var cost/unit Fixed costs $GM/unit BE volume
A $5.50 $2.25 $7,250,000
B $1,150 $885 $10,500,000
C $115 $60 $2,850,000
If it turns out these (the numbers below) are the actual volumes sold for each product, calculate the net income for each product; if any product is below break-even, calculate a new price for each product to get back to break-even at these volumes.
Product Actual Sales Volume $NI New Price?
A 2,000,000 units
B 25,000 units
C 50,000 units
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