Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The Shirt Works sells a large variety of tee shirts and sweatshirts. Steve Hooper, the owner, is thinking of expanding his sales by hiring high

The Shirt Works sells a large variety of tee shirts and sweatshirts. Steve Hooper, the owner, is thinking of expanding his sales by hiring high school students, on a commission basis, to sell sweatshirts bearing the name and mascot of the local high school.

These sweatshirts would have to be ordered from the manufacturer six weeks in advance, and they could not be returned because of the unique printing required. The sweatshirts would cost Hooper $18.00 each with a minimum order of 162 sweatshirts. Any additional sweatshirts would have to be ordered in increments of 162.

Since Hooper's plan would not require any additional facilities, the only costs associated with the project would be the costs of the sweatshirts and the costs of the sales commissions. The selling price of the sweatshirts would be $36.00 each. Hooper would pay the students a commission of $6.00 for each shirt sold.

Required:

1. What level of unit sales and dollar sales is needed to attain a target profit of $7,776?

2. Assume that Hooper places an initial order for 162 sweatshirts. What is his break-even point in unit sales and dollar sales?(Round your intermediate calculations and final answers to the nearest whole number.)

3. How many sweatshirts would Hooper need to sell to earn a target profit of $8,700?(Round your final answer to the nearest whole number.)

1.Unit sales needed to attain the target profit648

sweatshirtsDollar sales needed to attain the target profit$

23,328

2.Break-even point in unit sales97

sweatshirtsBreak-even point in dollar sales$

3,492

3.Number of sweatshirtsnot attempted

sweatshirts

Can you please help me with the last part of this question (3).

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Mergers, Acquisitions, And Corporate Restructurings

Authors: Patrick A Gaughan

6th Edition

1118997549, 9781118997543

More Books

Students also viewed these Accounting questions

Question

5. How is Karen Slagles argument an example of confirmation bias?

Answered: 1 week ago

Question

Go, do not wait until I come

Answered: 1 week ago

Question

Make eye contact when talking and listening

Answered: 1 week ago