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need help on questions 6 and 7 please. 5. The company expects that lowering the sale price by 105 and increasing advertising costs by $16,000
need help on questions 6 and 7 please. 5. The company expects that lowering the sale price by 105 and increasing advertising costs by $16,000 will cause unit sales to increase by 2016 (present sales are at 15,000 units). By how much would this affect (change) net income? Show all work! New Fixed Costs: 20*0.9218 50.000 + 30 000 + 16,000 396.000 New Sales Price: New Units Sold: 15.000 Present Net Income Sales 15.000 * 2.0 (15.000*0.2) +15.000 = 3:00 +15 000 = 181000 units Projected Net Income 18.000 300.000 Less: TVC (1500412) sales 18,1000 418 = $324,000 4316,000 2180-2007 CM 108,000 Less : TFC 2800007 2460007 Less! TVC 12. Do Less iFC Net Income s 12.000 Net Income $ 40,000 6. Refer to the original data. Assume the company is expected to sell 8,000 units next year. Prepare a contribution income statement at this level. 7. What new price should the company charge if they can sell only 8,000 units and they still want to break-even? Unit Costs: Sales VC Less: TVC FC Less: FC Net Income
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