1. XYZ Manufacturing

Scenario: Cost Behavior Analysis

Data: XYZ Manufacturing produces a single product with the following cost information:

• Fixed costs per month: $50,000
• Variable cost per unit: $20
• Selling price per unit: $50

Requirements:

1. Calculate the breakeven point in units and dollars for XYZ Manufacturing.
2. Discuss the behavior of fixed and variable costs in relation to production volume.
3. Analyze how changes in selling price affect XYZ Manufacturing's profitability.
4. Evaluate the impact of cost-volume-profit (CVP) analysis on decision-making at XYZ Manufacturing.
5. Recommend pricing strategies for XYZ Manufacturing based on cost behavior analysis.