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Outback Outtters sells recreational equipment lCine of the companv's products, a small camp stove, sells for $100 per unit. 1|itariable expenses are WI] per stove,

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Outback Outtters sells recreational equipment lCine of the companv's products, a small camp stove, sells for $100 per unit. 1|it"ariable expenses are WI] per stove, and xed expenses associated with the stove total $14T,DUU per month. Required: 1. lCompute the company's breakeven point in unit sales and in dollar sales. Number of stoves _ Total sales dollars _ 2. If the variable expenses per stove increase as a percentage of the selling price, will it resuit in a higher or a lower breakeven point? {Assume that the xed expenses remain unchanged.) 0 Higher break-even point D Lower break-even point 3. At present, the companv is selling 11,Ul] stoves per month. The sales manager is convinced that a 'l'ii: reduction in the selling price would result in a 25% increase in montth sales of stoves. Prepare two contlibution format income statements, one under present operating conditions, and one as operations would appear alter the proposed changes. 4. Refer tn the [late in [3] above. How many stoves would have to he sold at1he new selling pn'ee to yield a minimum net epereting income of $12,000 per mnnlh? [Round up your answer to the nearest whole number.)

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