fustrated
Mar 25, 2007, 09:11 AM
Hi
I would appreciate it if someone will check out my problem and see if I did it correctly, and if not help me out.
Thanks
The problem is:
Currently, the unit selling price is $30, the variable cost, $14, and the total fixed costs, $96,000. A proposal is being evaluated to increase the selling price to $34.
a.) compute the current break-even sales (units).
b.) Compute the anticipated break-even sales (units), assuming that the unit selling price is increased and all costs remain constant.
This is what I came up with, is this correct?
a.)$96,000/16 =6,000 units
b.)$34-14= $20 unit contribution margin, $96,000/$20=4800 units
I would appreciate it if someone will check out my problem and see if I did it correctly, and if not help me out.
Thanks
The problem is:
Currently, the unit selling price is $30, the variable cost, $14, and the total fixed costs, $96,000. A proposal is being evaluated to increase the selling price to $34.
a.) compute the current break-even sales (units).
b.) Compute the anticipated break-even sales (units), assuming that the unit selling price is increased and all costs remain constant.
This is what I came up with, is this correct?
a.)$96,000/16 =6,000 units
b.)$34-14= $20 unit contribution margin, $96,000/$20=4800 units