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Oriole Corp's sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the
Oriole Corp's sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 540,500 units of product: sales $2,702,500, total costs and expenses $2,803,440, and net loss $100,940. Costs and expenses consisted of the amounts shown below. Total Variable Fixed Cost of goods sold $2,306,180 $1,772,840 $533,340 Selling expenses 270,250 99,452 170,798 Administrative expenses 227,010 73,508 153,502 $2,803,440 $1,945,800 $857,640 Management is considering the following independent alternatives for 2021. 1. Increase unit selling price 20% with no change in costs, expenses, and sales volume. 2. Change the compensation of salespersons from fixed annual salaries totaling $162,150 to total salaries of $64,860 plus a 4% commission on sales. (a) Compute the break-even point in dollars for 2020. Break-even point $
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