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Paranormal Company is considering the development of two products: no. 65 or no. 66. Manufacturing cost information follows. No. 65 $270,000 30 No. 66 $441,000
Paranormal Company is considering the development of two products: no. 65 or no. 66. Manufacturing cost information follows. No. 65 $270,000 30 No. 66 $441,000 Annual fixed costs Variable cost per unit 24 Regardless of which product is introduced, the anticipated selling price will be $50 and the company will pay a 10% sales commission on gross dollar sales. Paranormal will not carry an inventory of these items. Required: A. What is the break-even sales volume (in dollars) on product no. 66? B. Which of the two products will be more profitable at a sales level of 29,000 units? C. At what unit-volume level will the profit/loss on product no. 65 equal the profit/loss on product no. 66? $1,050,000 A. Break-even sales B. Profitable at a sales level of 29,000 units: No. 65 No. 66 C. Unit-volume level $ $ 165,000 (6,000) 28,500 units
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