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Q3. A company makes and sells widgets. The sales price is $10 per unit. The company does not know what its variable costs and fixed
Q3. A company makes and sells widgets. The sales price is $10 per unit. The company does not know what its variable costs and fixed costs are, but the following estimates of total cost have been produced. At sales volume of 55,000 units, total costs = $607,500 At sales volume of 70,000 units, total costs = $675,000 Required: (a) Calculate the break-even point in sales (b) Calculate the margin of safety in units and % if budgeted sales are 68,000 units (c) Calculate the volume of sales required to achieve a target profit of $40,000 (20 marks)
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