Last year Anthony Fauci Ltd. introduced a new product and sold 25,000 units of it at a price of $97 per unit. The product's variable expenses are $67 per unit and its fixed expenses are $833,100 per year.
Required:
1. What was this product's net operating income (loss) last year?
2. What is the product's break-even point in unit sales and dollar sales?
3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g., $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit?
4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3?
U Stats, Mind Tap - Cengag... Gmail YouTube * Maps Translate Exam Saved Help Save & Exit Sub Problem 5-19 (Algo) Break-Even Analysis; Pricing [LO5-1, LO5-4, LO5-5] Last year Anthony Fauci Ltd. introduced a new product and sold 25,000 units of it at a price of $97 per unit. The product's variable expenses are $67 per unit and its fixed expenses are $833,100 per year. Required: 1. What was this product's net operating income (loss) last year? 2. What is the product's break-even point in unit sales and dollar sales? 3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g., $68. $66, etc.). what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit? 4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Assume the company has conducted a marketing study that estimates it can increase annual sales of this pro units for each $2 reduction in its selling price. If the company will only consider price reductions in increment $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and unit generate the maximum profit? Maximum annual profit Number of units Selling price per unit Prey 1 of 1 Next am Saved Help Save & Exit Sub Problem 5-19 (Algo) Break-Even Analysis; Pricing [LO5-1, LO5-4, LO5-5) Last year Anthony Fauci Ltd. introduced a new product and sold 25,000 units of it at a price of $97 per unit. The product's variable expenses are $67 per unit and its fixed expenses are $833,100 per year. Required: 1. What was this product's net operating income (loss) last year? 2. What is the product's break-even point in unit sales and dollar sales? 3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g. $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit? 4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 What would be the break-even point in unit sales and in dollar sales using the selling price that you determined requirement 3? (Do not round intermediate calculations Break-even point in units Break-even point in dollar sales
