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III. We are planning to produce and sell 60.000 units in the next period and in order to be able to prepare the financial information
III. We are planning to produce and sell 60.000 units in the next period and in order to be able to prepare the financial information of the period we are analyzing the results of the last 4 periods. Information not to change in the next period: Unit sale price 120 S/Unit Direct Material Cost 30 S/Unit Direct Labor Cost 12 S/Unit General Administration Expenses 650.000 $ Marketing, Sales & Dist. Expenses 420.000 $ Variable information on the periods, factory overheads related with production quantities were realized as follows in the last four years: 30.000 units of production with 160.000 $ in 2011; 40.000 units of production with 190.000 $ in 2012, 50.000 units of production with 240.000 S in 2013 and 36.000 units of production with 180.000 $ in 2014. 1. Compute the Breakeven Point in quantity and cost for the next period. 2. Prepare the Variable Income Statement of the next period. 3. Marketing manager proposes to make a 10% decrease in the sale price which is expected a 25% increase in the quantities sold. Make a comment on the proposal, is it acceptable or not
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