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Selling Price $35.00 = Sales Volume Variable 2,500 3,500 Fixed Cost Cost 4,500 Profitability 5,500 6,500 $ 42,500 12 $ 15,000 $38,000 $61,000 $84,000
Selling Price $35.00 = Sales Volume Variable 2,500 3,500 Fixed Cost Cost 4,500 Profitability 5,500 6,500 $ 42,500 12 $ 15,000 $38,000 $61,000 $84,000 $107,000 42,500 13 12,500 34,500 56,500 78,500 100,500 42,500 14 10,000 31,000 52,000 73,000 94,000 52,500 12 5,000 28,000 51,000 74,000 97,000 52,500 13 2,500 24,500 46,500 68,500 90,500 52,500 14 21,000 42,000 63,000 84,000 62,500 12 (5,000) 18,000 41,000 64,000 87,000 62,500 13 62,500 14 (7,500) 14,500 (10,000) 11,000 36,500 32,000 53,000 58,500 80,500 74,000 Required a. Determine the sales volume, fixed cost, and variable cost per unit at the break-even point. b. Determine the expected profit if Thornton projects the following data for Delatine: sales, 4,500 bottles; fixed cost, $42,500; and variable cost per unit, $14. c. Thornton is considering new circumstances that would change the conditions described in Requirement b. Specifically, the company has an opportunity to decrease variable cost per unit to $12 if it agrees to conditions that will increase fixed cost to $52,500. Volume is expected to remain constant at 4,500 bottles. Determine the effects on the company's profitability if this opportunity is accepted. Complete this question by entering your answers in the tabs below.
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