Question
Question 2] Whittier Company plans to sell 1,000 mowers at $400 each in the coming year. Total variable expense per unit is $325. Total fixed
Question 2]
Whittier Company plans to sell 1,000 mowers at $400 each in the coming year.
Total variable expense per unit is $325. Total fixed expense is $45,000.
Required:
1. Calculate the sales revenue and units that Whittier Company must make to break
even. ( 4 marks)
2. Check your answer by preparing a contribution margin income statement
based on the break-even point calculated.(5 marks)
3. Find the new break units and sales even under the following conditions
i. sales price increase by 25 %
ii. variable expenses reduced by $25
iii. Fixed cost has increased by 20 %
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