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Problem 2 - 2 0 ( Static ) CVP Applications: Break - Even Analysis; Cost Structure; Target Sales [ LO 2 - 1 , LO

Problem 2-20(Static) CVP Applications: Break-Even Analysis; Cost Structure; Target Sales [LO2-1, LO2-3, LO2-4, LO2-5, LO2-6, LO2-8]
Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15 per ball, of which 60% is direct labor cost.
Last year, the company sold 30,000 of these balls, with the following results:
\table[[Sales balls),$750,000
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