Outback Outfitters sells recreational equipment. One of the companys products, a small camp stove, sells for $100 per unit. Variable expenses are $70 per stove, and fixed expenses associated with the stove total $138,000 per month.

1.

What is the break-even point in unit sales and in dollar sales?

Break-even point in unit sales
Break-even point in dollar sales

2. Refer to the data below. How many stoves would have to be sold at the new selling price to attain a target profit of $77,000 per month? (Round up your final answer to the nearest unit.)

3.

At present, the company is selling 19,000 stoves per month. The sales manager is convinced that a 10% reduction in the selling price would result in a 25% increase in monthly sales of stoves. Prepare two contribution format income statements, one under present operating conditions, and one as operations would appear after the proposed changes. Contribution Income Statement Outback Outfitters Present 19,000 Stoves Total Per unit Proposed Stoves Total Per unit 0 $ 00 $ S 0