Part 3 Cost-Volume-Profit Analysis (25 Points)

Mauro Products distributes a single product, a woven basket whose selling price is $15 [per unit] and whose variable expense is $12 [per unit]. The company's monthly fixed expense is $6,000.

Required

1. Solve for the company's break-even point in unit sales. Show computations.

2. Determine the company's break-even point in Total Sales Dollars. Show computations.

3. Discuss graphical considerations.

1. Break-even point in Units

2. Break-even in Total Sales Dollars

3. Graphical Considerations

A. Explain how the lines on a Cost-Volume-Profit graph and the break-even point would change if

The selling price per unit increased.

B. Explain how the lines on a Cost-Volume-Profit graph and the break-even point would change if

Variable cost per unit increased