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Pierson Pet Products produces two models of dog beds: Basic and Custom. Price, cost and expected sales volume data for the two models are
Pierson Pet Products produces two models of dog beds: Basic and Custom. Price, cost and expected sales volume data for the two models are as follows: Basic Selling price per bed $ 19.00 Custom $ 54.00 Variable cost per bed $ 12.00 36,000 $ 33.00 24,000 Expected sales (beds) The total fixed costs for the company are $396,900. Required: a. What is the anticipated level of profits for the expected sales volumes? b. Assuming that the expected product mix applies regardless of total sales, compute the break-even volume. Note: Do not round intermediate calculations. c. If the product sales mix were to change to three Basic beds for each Custom bed, what would be the new break-even volume? Note: Do not round intermediate calculations.
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