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PROBLEM #4 CC Cookware markets a new frying pan with a selling price of $49 per pan. The variable costs per unit are $30, and
PROBLEM #4 CC Cookware markets a new frying pan with a selling price of $49 per pan. The variable costs per unit are $30, and the total fixed costs related with producing the pan are $355,000. Assume the CC Cookware's tax rate is 25%. 1. What is the break-even point in units? 2. What is the break-even point in sales dollars? 3. The company's planned sales volume is 60,000 units. What is the operating profit or loss (pre-tax income) at that level of sales volume? 4. What is the company's net income at the planned sales volume of 60,000 from part 3? 5. Suppose the company modernized its factory, increasing total fixed costs by $45,000. This modernization will increase the contribution margin ratio to 45%. What is the break-even point in units, after the plant is modernized? Assume selling price stays the same
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