Question no.3 Assume that the following data has been determined for the development and sale of a new digital thermometer for home use: development cost = $100,000, production investment = $300,000, annual production volume = 15,000 units per year, and sales lifetime = 6 years. Assuming a variable production cost of $4 per unit. Determine the followings: a) The sales price necessary to break even within 2 years b) The profit expected over the estimated sales lifetime.

Question no.3 Assume that the following data has been determined for the development and sale of a new digital thermometer for home use: development cost = $100,000, production investment = $300,000, annual production volume = 15,000 units per year, and sales lifetime = 6 years. Assuming a variable production cost of $4 per unit. Determine the followings: a) The sales price necessary to break even within 2 years b) The profit expected over the estimated sales lifetime.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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