Question
Management believes it can sell a new product for $8.50. The fixed costs of production are estimated to be $5,500, and the variable costs are
Management believes it can sell a new product for $8.50. The fixed costs of production are estimated to be $5,500, and the variable costs are $4.10 a unit. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar. Enter zero if necessary. Use a minus sign to enter losses, if any.
Quantity | Total Revenue | Variable Costs | Fixed Costs | Total Costs | Profits (Losses) | |
0 | $ | $ | $ | $ | $ | |
500 | $ | $ | $ | $ | $ | |
1,000 | $ | $ | $ | $ | $ | |
1,500 | $ | $ | $ | $ | $ | |
2,000 | $ | $ | $ | $ | $ | |
2,500 | $ | $ | $ | $ | $ | |
3,000 | $ | $ | $ | $ | $ |
Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break-even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs, and profits (losses) to the nearest dollar. Enter zero if necessary. Use a minus sign to enter losses, if any.
Quantity | Total Revenue | Variable Costs | Fixed Costs | Total Costs | Profits (Losses) |
$ | $ | $ | $ | $ |
What would happen to the total revenue schedule, the total cost schedule, and the break-even level of output if management determined that fixed costs would be $11,000 instead of $5,500? Round your answer for the break-even level of output to the nearest whole number.
If fixed costs were $11,000 instead of $5,500 the total revenue schedule -Select-increasesdecreasesdoes not changeItem 42 and the total cost schedule -Select-increasesdecreasesdoes not changeItem 43 .
The new break-even level of output is units.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started