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Sandy Bank, Inc., makes one model of wooden canoe. And, the information for it follows: Number of canoes produced and sold Total costs 750 400
Sandy Bank, Inc., makes one model of wooden canoe. And, the information for it follows: Number of canoes produced and sold Total costs 750 400 600 $ 67,500 $150,000 $101,250 $150,000 $126,563 $150,000 Variable costs Fixed costs $217,500 $251,250 $276,563 Total costs Cost per unit Variable cost per unit Fixed cost per unit 168.75 168.75 250.00 168.75 375.00 200.00 $ 368.75 543.75 418.75 Total cost per unit Sandy Bank sells its canoes for $550 each. Required: 1. Suppose that Sandy Bank raises its selling price to $675 per canoe. Calculate its new break-even point in units and in sales dollars. (Round your answers to the nearest whole number.) New Break-Even Units Break-Even Sales Revenue Canoes 2. If Sandy Bank sells 650 canoes, compute its margin of safety in units and as a percentage of sales. (Use the new sales price of $675.) (Round your answers to the nearest whole number.) Margin of Safety Percentage of Sales % 3. Calculate the number of canoes that Sandy Bank must sell at $675 each to generate $100,000 profit. (Round your answer to the nearest whole number.) Target Sales Units Canoes
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