Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question # 1 Barhoms Cellular (BC) is a distributor and sells phones for $1250. BC gets the phones for $900 each. BC pays the sales

Question # 1

Barhoms Cellular (BC) is a distributor and sells phones for $1250. BC gets the phones for $900 each. BC pays the sales staff a commission of 10% for each phone sold. BCs fixed selling, administrative & other fixed costs total $36,900 per year.

Required:

  1. How many phones BC needs to sell to achieve a target profit of $51,000 a year?
  2. BC is considering selling another type of phone. The new phone has a cost of $1,400 and will be sold for $2,000 each. The sales commission policy will apply for the new phone too. Barhom expects that out of every four phones he sells one will be from the new one and three from the old one. How many phones of each he needs to sell to breakeven.

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

Business Accounting Volume 2

Authors: Frank Wood

4th Edition

0582413435, 978-0582413436

More Books

Students also viewed these Accounting questions

Question

Find the real solutions of each equation. x - x x x 4 = x + 2 -

Answered: 1 week ago