Now solve for the unknown selling price per unit thatwill maintain the same breakeven point. The selling price per unit to maintain the same breakeven point is $ Requirementtc] Assume next that the company has decided to increase its selling price to 0.70 per bar wi h no change in advertising or ingredients Compute the sales volume in units that would be needed at he new price for the company to earn the same profit as it earned last month First enter the formula to calculate the sales volume needed (required units): then calculate the required units. ( + )i' : Required units E + I) ." : Requirements Requirements {a} {bi The sales manager is confident that an intensive advertising campaign will double sales volume. If the company president's goal is to increase this month's profits by 60% over last month's: what is the maximum amount that can be spent on advertising that doubles sales volume? Assume that the company increases the duality of its ingredients; thus increasing variable costs to $0.55 per bar. By how much must the selling price per unit be increased to maintain the same breakeven point in units? Assume next that the company has decided to increase its selling price to 0.70 per bar with no change in advertising or ingredients. Compute the sales volume in units that would be needed at the new price for the company to earn the same profit as it earned last month. The Dessert Delights Candy Company produces a Single product. a chocolate almond bar that sells for SO 65 per bar. The variable costs for each bar (sugar, chocolate: almonds, wrapper, and labor) total $0.4 The total monthly fixed costs are $60,000. Last month: bar sales reached 1 7 million. However: the president of Dessert Delights Candy Company was not satisfied with its pen'ormance and is considering the following options to increase the company's protability: 1. Increase advertising. 2. Increase the quality ofthe bar's ingredients and simultaneously increase the selling price. 3. Increase the selling price with no change in ingredients Read the duirements. Requirement (3] The sales manager is confident that an intensive advertising campaign will double sales volume. lfthe company president's goal is to increase this month's profits by 60% over last month's. what is the maximum amount that can be spent on advertising that doubles sales volume'? En er the formula you will use to so ve for maximum amount that can be spent on advertising in the current month (AbbreViations used' CM : Contribution margin SP : Sales price. VC :Variable costs) 7 7 = Protit Now calculate the amountthat can be spent on advertismg by solwng for the unknown advertising costs. The maXimum amount that can be spent on advertismg is $ Requirement (b1 Assume that the company increases the uality of its ingredients. thus increasing variable costs to $0 55 per bar. By how much must the selling price per unit be increased to maintain the same breakeven point in units? Begin by calculating the breakeven point with the original variable costs First enter the formula then calculate the breakeven point r' = Breakeven units r : Now enterthe formula to compute proti in this scenario. (Abbreviations used: CM : Contribution margin: SP : Sales price. VC : Variable costs) Protit