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Please help me i will give good rating A company manufactures a single product. Budget and standard cost details for next year include: Selling price
Please help me i will give good rating
A company manufactures a single product. Budget and standard cost details for next year include: Selling price per unit $16.00 Variable production cost per unit $5.80 Fixed production costs $210,000 Fixed selling and distribution costs $145,000 Sales commission 5% of selling price Sales 85,000 units Required: (i) Calculate the break-even point in units. (ii) The marketing manager has suggested that the selling price per unit can be increased to $23.00 if the sales commission is increased to 8% of selling price and a further $25,000 is spent on advertising. Calculate the percentage by which the budgeted sales can fall before the company begins to make a loss and the revised break-even point based on the marketing manager's suggestion. (iii) The marketing manager has suggested that the selling price per unit can be increased to $21.00 if the sales commission is increased to 10% of selling price and a further $15,000 is spent on distribution. Calculate the percentage by which the budgeted sales can fall before the company begins to make a loss the revised break-even point based on the marketing manager's suggestionStep by Step Solution
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