Pierre Computer Company manufactures personal computers and tablets. Based on the latest information from the cost accountant, using the current sales mix, the weighted-average sales price per unit is $730 and the weighed-average variable cost per unit is $584. The company does not expect the sales mix to vary for the next year. Average fixed costs per month are $67,160. Read the requirements Requirements 1. What is the number of units that must be sold each month to reach the breakeven point? 2. If the company currently sells 840 units per month, what is the margin of safety in units and dollars? 3. If Pierre Computer Company desires to make a profit of $7,300 per month, how many units must be sold? 4. Pierre Computer Company thinks it can restructure some costs so that fixed costs will be reduced to $21,900 per month, but the weighted average variable cost per unit will increase to $657 per unit. What is the new breakeven point in units? Does this increase or decrease the margin of safety? Why or why not? Print Done Does this increase or decrease the margin of safety? Why or why not? This the margin of safety because Requirement 4. Pritchet Computer Company thinks it can restructure some costs so that fixed costs will be reduced to $76,680 per month, but the weighted average variable cost per unit will increase to 5497 per unit. WH new breakeven point in units? Does this increase or decrease the margin of safety? Why or why not? Begin by calculating the new breakeven point in units. (Complete all input fields. Enter a "0" for any zero balances.) Breakeven in units Requirement 3. If Pritchet Computer Company desires to make a profit of $22,720 per month, how many units must be sold? (Complete all input fields. Enter a "0" for any zero balances.) = Required sales in units Now calculate the margin of safety in dollars. = Margin of safety in dollars II Requirement 2. If the company currently sells 900 units per month, what is the margin of safety in units and dollars? Begin by calculating the margin of safety in units. Margin of safety in units Requirement 1. What is the number of units that must be sold each month to reach the breakeven point? Start by selecting the formula and entering the amounts to compute the breakeven point in units. (Complete all input fields. Enter a "0" for any zero balances.) = Breakeven in units
