Question
Tanek Corp.s sales slumped badly in 2017. For the first time in its history, it operated at a loss. The companys income statement showed the
Tanek Corp.s sales slumped badly in 2017. For the first time in its history, it operated at a loss. The companys income statement showed the following results from selling515,500units of product: sales $2,577,500, total costs and expenses $2,680,600, and net loss $103,100. Costs and expenses consisted of the amounts shown below.
Total Variable Fixed
Cost of goods sold $2,206,340 $1,639,290 $567,050
Selling expenses 257,750 94,852 162,898
Administrative expenses 216,510 70,108 146,402
$2,680,600 $1,804,250 $876,350
Management is considering the following independent alternatives for 2018.
1.Increase unit selling price21% with no change in costs, expenses, and sales volume.
Compute the break-even point in dollars under each of the alternative courses of action.(Round selling price per unit to 2 decimal places, e.g. 5.25 and other calculations to 0 decimal places, e.g. 20% and also final answer to 0 decimal places, e.g. 1,225.)
Break-even point for alternative 1. ??? (I am not sure if my rounding is incorrect but I keep getting around 2,079,185 but is incorrect no matter how I round)
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