Outback Outfitters sells recreational equipment. One of the company's products, a small camp stove, sells for $150 per unit. Variable expenses are $105 per stove, and fixed expenses associated with the stove total $225,000 per month 8 03:10:37 eBook Print Required: 1. What is the break-even point in unit sales and in dollar sales? 2. If the variable expenses per stove increase as a percentage of the selling price, will it result in a higher or a lower break-even point? (Assume that the fixed expenses remain unchanged.) selling 14,000 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. 4. Refer to the data in Required 3. How many stoves would have to be sold at the new selling price to attain a target profit of $75,000 per month? References Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 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 Required 2 > a target profit of $75,000 per month? Complete this question by entering your answers in the tabs below. Required 1 Refuired 2 Required 3 Required 4 If the variable expenses per stove increase as a percentage of the selling price, point? (Assume that the fixed expenses remain unchanged.) Higher break-even point O Lower break-even point Required 1 Required 3 Required 1 Required 2 Required 3 Required 4 At present, the company is selling 14,000 stoves per month. The sales manager is convinced that a 10% selling price would result in a 25% increase in monthly sales of stoves. Prepare two contribution format in one under present operating conditions, and one as operations would appear after the proposed changes. Contribution Income Statement Outback Outfitters Present 14,000 Stoves Total Per unit Proposed Stoves Total Per unit nt Complete this question by entering your answers in the tabs below. ences Required 1 Required 2 Required 3 Required 4 Refer to the data in Required 3. How many stoves would have to be sold at the new se $75,000 per month? (Round up your final answer to the nearest unit.) Unit sales needed to attain the target profit Required 3 Required 4 Whirly Corporation's contribution format income statement for the most recent month is shown below: Total $ 282,200 157,700 Per Unit $ 34.00 19.00 Sales (8,300 units) Variable expenses Contribution margin Fixed expenses Net operating income $0 55,300 69.200 Required: (Consider each case independently): 1. What would be the revised net operating income per month if the sales volume increases by 100 units? 2. What would be the revised net operating income per month if the sales volume decreases by 100 units? 3. What would be the revised net operating income per month if the sales volume is 7,300 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income
