Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

pharoach manufacturing ltd has provided you with the following cvp income statement Sales Sales (5,000 units) Variable costs Contribution margin Fixed costs Operating income $1,000,000

pharoach manufacturing ltd has provided you with the following cvp income statement Sales

Sales (5,000 units) Variable costs Contribution margin Fixed costs Operating income $1,000,000 670,000 330,000 274,560 $55,440 $200 134 per unit per unit $66 perunit

Management is considering the following course of action to increase operating income: reduce the selling price by 20%, with no changes to unit variable costs or fixed costs. Management feels that this change will increase unit sales by 30%.

Calculate the break-even point in units and sales dollars with no change in sales. (Round contribution margin ratio to 5 decimal places, eg. 15.22456%. Round units to 0 decimal places, e.g. 5,275 and dollar amount to 2 decimal places, e.g. 15.25.)

breakeven points in units and $dollar..?

Calculate the break-even point in units and sales dollars with the proposed change in sales price. (Round units to 0 decimal places, e.g. 5,275 and dollar amount to 2 decimal places, e.g. 15.25.)

breakeven points in units and dollar..?

should management go forward with the reduction in sales price ? yes or no ?

i just want an answer not explanation

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Managerial Accounting

Authors: Ray Garrison

12th Edition

B002ODFC0E

More Books

Students also viewed these Accounting questions

Question

Describe how to prevent and treat choking.

Answered: 1 week ago

Question

8. Explain the relationship between communication and context.

Answered: 1 week ago

Question

d. How were you expected to contribute to family life?

Answered: 1 week ago