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Ivanhoe Manufacturing's sales slumped badly in 2022. For the first time in its history, it operated at a loss. The company's income statement showed the
Ivanhoe Manufacturing's sales slumped badly in 2022. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 51,600 units of product: net sales $1,548,000; total costs and expenses $1,728,600; and net loss $180,600. Costs and expenses consisted of the amounts shown below: Total Variable Fixed Cost of goods sold $1,161,000 $799,800 $361,200 Selling expenses 412,800 107,500 305,300 Administrative expenses 154,800 98,900. 55,900 $1,728,600 $1,006,200 $722,400 Management is considering the following independent alternatives for 2023: 1. Increase the unit selling price by 25% with no change in costs, expenses, or sales volume. 2. Change the compensation of salespersons from fixed annual salaries totalling $172,000 to total salaries of $17,200 plus a 5% commission on net sales. 3. Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50. Calculate the break-even point in dollars for 2022. Break-even point $
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