[sagnik2422]

Trenton and Company makes a single product requiring $50 of direct materials. Manufacturing overhead is applied using a predetermined overhead of 150% of direct labor cost. One third of manufacturing overhead is fixed. There is no under or over applied overhead and the company has no beginning or ending inventory. The company reports the following results for August :
Number of Units Sold : 8,000
Selling Price Per Unit : $300
Manufacturing Cost Per Unit : $200
Variable Selling and Admin. Expenses per unit : $45
Total Fixed Selling and Admin Expenses : $290,000
Question : How many units can sales go down before company incurs a loss?
A) 1765 B) 5,100 C) 2,700 D) 6,235 E ) None
Please show help with steps. They say 150% of direct labor cost but don't give direct labor cost, is this a trick?

[paraclete]

Logic, what are the components of manufacturing cost?

manufacturing cost per unit = $200
materials = $50 = 25%
Labour ]
Overhead ] = $150

if overhead = 150% of labour what does labour plus overhead =? 250% of labour

In what way is this relevant? In what way is any of the numbers given relevant?

don't waste your time answering questions that aren't asked

over to you think about the selling and admin cost, this should enable you to see the company is already in loss