' l , = eztomheducationcom or r o , r11 l E7 . . .9995\"'.'.'.2:Weekissessw's't.l'm|3!e_"r9"'lef' .. Week 5 Assessment Problems 0 Saved Help Save 8. Exit Submit Check my work mode : This shows what is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to quest 25 Disk City, Inc., is a retailer for digital video disks. The projected net income for the current year is $1,260,000 based on a sales volume points of 230,000 video disks. Disk City has been selling the disks for $20 each. The variable costs consist ofthe $10 unit purchase price of the disks and a handling cost of $2 per disk. Disk City's annual xed costs are $580,000. Problem 7-34 Basic CVP Relationships; Retailer (L0 74, 7-2, 7-4) Management is planning for the coming year. when it expects that the unit purchase price ofthe video disks will increase 30 percent. (Ignore income taxes.) Required: 1. Calculate Disk City's break-even point for the current year in number of video disks. (Round your final answer up to nearest whole number.) 2. What will be the company's net income for the current year if there is a 15 percent increase in projected unit sales volume? 3. What volume of sales (in dollars) must Disk City achieve in the coming year to maintain the same net income as projected for the current year if the unit selling price remains at $20? (Do not round intermediate calculations. Round your final answer to the nearest whole number.) 4. In order to cover a 30 percent increase in the disk's purchase price for the coming year and still maintain the current contribution- margin ratio, what selling price per disk must Disk City establish for the coming year? (Do not round intermediate calculations. Round your nal answer to 2 decimal places.) 0 Answer Is complete but not entlrely correct. 1. Break-even point 72,500 9 units 2. Net income $ 1,536,000 9 3. Volume of sales $ 6,045,714 0 4, Selling price per disk $ 4.05 0 Next %