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Straightforward CVP analysis question I'm stuck on, can you please help? Straightforward CVP analysis FRB Inc. sells a single product for $43. The following costs
Straightforward CVP analysis question I'm stuck on, can you please help?
Straightforward CVP analysis FRB Inc. sells a single product for $43. The following costs and expenses were incurred at store No. 504: Variable costs per unit Annual fixed costs Invoice cost, $24 Sales commission, $4 Salaries, $60,000 Advertising, $14,000 Other, $16,000 The company sold 8,200 units during 20X4. Instructions a Compute the 20X4 break-even point in both dollar and unit sales. b By how much will sales have to increase in 20X5 over 20X4 levels if management wishes to earn a target income of $14,400? c At present, how much does each unit provide toward covering FRB's fixed costs and generating income? Assume that management believes this amount is too low. What alternatives are available to FRB? d What would be the effect on the break-even point if management reduced salary costs by $11,600 and increased the $4 sales commission by 20%? a. 20X4 break-even point in dollars 20X4 break-even point in units b. Sales needed in 20X5 to earn net income of 14,400 c. how much does each unit provide toward covering FRB's fixed costs? What alternatives are available to increase this amount? d. break even point if salary reduced and sale commision increasedStep by Step Solution
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