Question
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
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