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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 as
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:
BasicCustomSelling price per bed$ 22.00$ 57.00Variable cost per bed$ 15.00$ 36.00Expected sales (beds)54,00036,000The total fixed costs for the company are $400,680.
Required:
- What is the anticipated level of profits for the expected sales volumes?
- Assuming that the expected product mix applies regardless of total sales, compute the break-even volume.
- If the product sales mix were to change to three Basic beds for each Custom bed, what would be the new break-even volume?
Pierson Pet Products produces two models of dog beds: Basic and Custom. Price, cost and expected sales volume data for the two models are as follows:
BasicCustomSelling price per bed$ 22.00$ 57.00Variable cost per bed$ 15.00$ 36.00Expected sales (beds)54,00036,000The total fixed costs for the company are $400,680.
Required:
- What is the anticipated level of profits for the expected sales volumes?
- Assuming that the expected product mix applies regardless of total sales, compute the break-even volume.
- If the product sales mix were to change to three Basic beds for each Custom bed, what would be the new break-even volume?
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