Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Problem 1 After graduating from AUD Sarah plans to start a book publishing company in the Media City. She did some research and found that

image text in transcribed

Problem 1 After graduating from AUD Sarah plans to start a book publishing company in the Media City. She did some research and found that the printer will cost around Dh 250,000. The printer is expected to work for a year. She estimated that the variable cost per book will be Dh 150 and the selling price will be Dh 400. a. How many books must she sell to break even? Also calculate the breakeven in dirham. b. In addition to the costs given above, if she wants to pay herself a salary of Dh 50,000 per year, what is her breakeven point in units and dirham? c. In the first six months of her business, she sold 300 books. To improve her sales, she made some changes in the book and includes answers to end of chapter problems as a booklet sold with the book. To prepare these answers, she needs to spend Dh 25 per book. She increased the price to 455 a book. In addition to 300 books sold, how many more books she should sell to breakeven? Assume that this part of the question is independent, and she does not draw any separate salary

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Project Finance In Theory And Practice

Authors: Stefano Gatti

3rd Edition

0128114010, 978-0128114018

More Books

Students also viewed these Finance questions