Using break-even analysisA new product is expected to have sales of $100,000, variable costs of 60% of sales, and fixed costs of $20,000.1. Using graph paper, construct a break-even chart and label the sales line, total cost line, fixed cost line, break-even point, and net income and net loss areas.2. From the chart, identify the break-even point and the amount of income or loss if sales are $100,000.
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Using break-even analysis
A new product is expected to have sales of $100,000, variable costs of 60% of sales, and fixed costs of $20,000.
1. Using graph paper, construct a break-even chart and label the sales line, total cost line, fixed cost line, break-even point, and net income and net loss areas.
2. From the chart, identify the break-even point and the amount of income or loss if sales are $100,000.
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- Assume that the linear cost and revenue models apply. An item costs $13 to make. If fixed costs are $1600 and profits are $5700 when 100 items are made and sold, find the revenue equation. (Let x be the number of items.)R(x) =1. Calculate the contribution margin rate, the sales dollar breakeven point, and the unit sales breakeven point. 2. Use the following information to perform your calculations. a. Net Sales: $50,000.00 b. Contribution Margin: $20,000.00 c. Total Fixed Costs: $15,500.00 d. Unit Sales Price: $25.00 3. Provide the formula and write out the equation that you use for each calculation. a. Contribution Margin Rate: b. Sales Dollar Breakeven Point: C. Unit Sales Breakeven Point:If the variable cost is P15/unit, fixed cost is 265,000; and Sales is P55. Find the BEPs, and BEPx. Use the Target Profit Analysis Equation Method. Compute for the following: • Contribution Margin Ratio • Break-Even Point in Sales • Break-Even Point in Units IMPORTANT NOTE: PLEASE REFER TO THE GIVEN LESSON. USE THE FORMULA FROM THE LESSON IN THE PHOTE ATTACHED. THANK YOU. I will give you upvote for this.
- A company would like to determine various costs and points to aid them in deciding whether to expand or not. If you are given the following information, compute the required amounts and / or figures.Selling price / unit = P100 Variable cost / unit = P70Annual fixed cost = P500,000 Compute 5. Sales in units to earn a profit of 10% of sales.(a) Build a spreadsheet model to calculate the profit/loss for a given demand. What is the demand? (b) Use Goal Seek to calculate the price that results in breakeven. If required, round your answer to two decimal places. c) Use a data table that varies price from 350 to 3400 in increments of 325 to find the price that maximizes profit.APPLY THE CONCEPTS: Use the CVP graph to analyze the effects of changes in price and costs Graph the following on your own paper. At the original position, the break-even point in sales dollars is $24,000 at 500 units. The fixed costs are $8,000. Assume the slope of the sales line is equal to the selling price. When the two points of the sales line are at the origin and the break-even point, you see that the slope of the line is $48, which means that the selling price is $ When the two points of the total costs line are at the origin and the break-even point, you see that the slope of the line is $32.00, which means that the variable cost per unit is $ Leave the break-even point (x) at its original position. Use it as a reference point to answer the following questions. Analyze the scenarios by sliding the points on the lines to get the slope desired. Recall that the new break-even point for each scenario exists where the sales and total costs lines intersect. Compare it to the…
- Suppose that the total cost function, in dollars, for the production of x units of a product is given by the equation shown below. C(x) = 4,500 + 30x + 0.2x² Then the average cost of producing x items is represented by the following equation. total cost 4,500 C(x) + 30 + 0.2x (a) Find the instantaneous rate of change of average cost with respect to the number of units produced, at any level of production. (b) Find the level of production at which this rate of change equals zero. X = (c) At the value found in part (b), find the instantaneous rate of change of cost and find the average cost. instantaneous rate of change of cost average cost What do you notice?APPLY THE CONCEPTS: Target income (sales revenue) Another useful method for figuring out the type of performance your company will need to reach a target income is by using sales revenue. Rather than using the number of units, this method uses total sales revenue. In companies for which the total set of goods produced and sold is more varied, this would be the preferred method, as opposed to a business in which only one product is sold. Assume a company has pricing and cost information as follows: Price and Cost Information Amount Selling Price per Unit $30 Variable Cost per Unit $15 Total Fixed Cost $15,000 For the upcoming period, the company wishes to generate operating income of $40,000. Given the cost and pricing structure for the company's product, how much sales revenue must it generate to attain its target income? Step 1: Calculate the contribution margin ratio: The contribution margin ratio is the contribution margin in proportion to the selling price on a per-unit basis.…Management believes it can sell a new product for $6.50. The fixed costs of production are estimated to be $5,500, and the variable costs are $2.50 a unit. Complete the following table at the given levels of output and the relationships between quantity and fixed costs, quantity and variable costs, and quantity and total costs. Round your answers to the nearest dollar. Enter zero if necessary. Use a minus sign to enter losses, if any. Quantity Total Revenue Variable Costs Fixed Costs Total Costs Profits (Losses) 0 $ $ $ $ $ 500 $ $ $ $ $ 1,000 $ $ $ $ $ 1,500 $ $ $ $ $ 2,000 $ $ $ $ $ 2,500 $ $ $ $ $ 3,000 $ $ $ $ $ Determine the break-even level using the above table and use the Exhibit 19.5 to confirm the break-even level of output. Round your answers for the break-even level to the nearest whole number. Round your answers for the fixed costs, variable costs, total costs,…
- Evaluate the quantity at which revenue equals to costs (break-even point). <use Goal seek> Assumptions: Fixed cost: 5000 Material costs per item: 2.25 Labor costs per item: 6.5 Shipping costs per 100 items: 200 Price per item: 12.991. Calculate the per-unit contribution margin of a product that has a sale price of $200 if the variable costs per unit are $65. PLEASE NOTE: The per-unit Contribution Margin will be rounded in whole dollars and shown with "$" and commas as needed (i.e. $12,345). A product has a sales price of $150 and a per-unit contribution margin of $50. What is the contribution margin ratio? PLEASE NOTE: The Contribution Margin Ratio will be shown as a percentage, shown with "%" and rounded to three decimal places (i.e. 12.3%).Total fixed cost of a product is IDR 10,000,000 and variable cost is IDR 50,000 per unit. The sale price is IDR.75,000 per unit . How much products should be produced to get BEP? Prove your answer and make a graphic. ..And If the company need profit IDR 10,000,000. How much is the sales price? Prove your answer.