Krait Products sells camping equipment. One of the company's products, a camp lantem, sells for $100 per unit Variable expenses are $70 per lantern, and food expenses associated with the lantem total $141120 per month Required: 1. Compute the company's break even point in number of lonters and in total sales dolors, Freak-even point in units sold Break-even sales in collars Break-even Point 4,704 5 470.400 I 2. If the variable expenses per lantern increase as a percentage of the selling price will it result in a higher or a lower break-even point? (Assume that the fixed expenses remain unchanged) Higher Lower 3. At present the company is selling 8,820 tontorns per month The sales manager is convinced that a 5% reduction in the selling price will result in a 20% increase in the number of lanterns sold each month. Prepare two contbution format Income statements one under present operating conditions, and one as operations would appear after the proposed changes. Show both total and per unit data on your statements. (Do not round intermediate calculations. Round your answers to the nearest whole dollar amount) Present Per Unit Proposed Total Per Unit Total Sales OS O O O $ Add: Fixed expenses Add: Vanable expenses Less: Fixed expenses Less: Variable expenses 3. At present, the company is selling 8.820 lanterns per month. The sales manager is convinced that a 5% reduction in the song once will result in a 20% increase in the number of lanterns sold each month Prepare two contribution format income statements one under present operating conditions, and one as operations would appear after the proposed changes Show both total and per unit data on your statements. (Do not round intermediate calculations. Round your answers to the nearest whole dotat amount.) Present For Unit Proposed Total Per Unit Total Sales os a OS 0 $ 0 $ 0 Contribution margin Contribution loss 3. At present, the company is selling 8,820 lanterns per month The sales manager is convinced that a Suction in the price will result in a 20% increase in the number of fontes sold each month Prepare two contribution format income statements one under present operating conditions, and one as operations would appear after the proposed changes Show both toil and perut data on your statements (Do not round intermediate calculations. Round your answers to the nearest whole color wount) Proposed tou Per Una For Unit Sales 0 0 05 5 Show All items Add: Fixed expenses Add: variable expenses Less: Fixed expenses Less: Vanable expenses 3. At present, the company is selling 8.820 lanterns per month The sales manager is convinced that a 5% reduction in the seling pince will result in a 20% increase in the number of lanterns sold each month Prepare two contribution format income statement on under present operating conditions, and one is operations would appear after the proposed changes Show both total and per unit data on your statements. (Do not round Intermediate calculations. Round your answers to the nearest whole dollar amount) Pre Proposed Total Total Per Unit Sales OS 0 OS 0 5 0 5 0 Net operating income Net operating loss 4. At present the company is selling 8,820 lanterns per month The sales manager is convinced that a 5% reduction in the selling price will result in a 20% increase in the number of lanterns sold each month. How many lanterns would have to be sold at the new selling price to yield a minimum net operating income of $72.180 per month (Do not round Intermediate calculations.) Unit Sales to attain target profit
