Answered step by step
Verified Expert Solution
Question
1 Approved Answer
please help i am having trouble undertanding 3 and 4. thank you! Last year Minden Company Introduced a new product and sold 25,200 units of
please help i am having trouble undertanding 3 and 4. thank you!
Last year Minden Company Introduced a new product and sold 25,200 units of it at a price of $95 per unit. The product's variable expenses are $65 per unit and its fixed expenses are $832,500 per year. Required: 1. What was this product's net operating income foss) last year? 2. What is the product's break-even point in unit sales and dollar sales? 3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (eg. $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit 4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3? Complete this question by entering your answers in the tabs below + Required 1 Required 2 Required 3 Required 4 What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 37 (Do not round Intermediate calculations.) Break even point in units Break-even point in dollar sales Last year Minden Company introduced a new product and sold 25,200 units of it at a price of $95 per unit. The product's variable expenses are $65 per unit and its fixed expenses are $832,500 per year. Required: 1. What was this product's net operating income (loss) last year? 2. What is the product's break even point in unit sales and dollar sales? 3. Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2(e.g., $68, $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit? 4. What would be the break-even point in unit sales and in dollar sales using the selling price that you determined in requirement 3? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required Required 4 Assume the company has conducted a marketing study that estimates it can increase annual sales of this product by 5,000 units for each $2 reduction in its selling price. If the company will only consider price reductions in increments of $2 (e.g. $68. $66, etc.), what is the maximum annual profit that it can earn on this product? What sales volume and selling price per unit generate the maximum profit? Show less Maximum annual profit Number of units Selling price per unit Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started