Gardens, Inc., prewashes, shreds, and distributes a variety of salad mixes in 2-pound bags. Doug Voss, Operations VP, is considering a new Hi-Speed shredderto replace the old machine, referred to in the shop as "Clunker." Hi-Speed will have a fixed cost of $95,000 per month and a variable cost of $1.20 per bag.Clunker has a fixed cost of only $45,000 per month, but a variable cost of $2.00. Selling price is $2.80 per bag.d) What is the break-even point in units with the Hi-Speed shredder?e) What is the break-even point in dollars with the Hi-Speed shredder?f) What is the monthly profit if the company selects the Hi-Speed shredder and sells 70,000 bags per month? You are considering opening a copy service in the student union. You estimate your fixed cost at $15,000 and the variable cost of each copy sold at$0.01. You expect the selling price to average $0.05.a) What is the break-even point in dollars?b) What is the break-even point in units?

a) The break-even point in dollars for the copy service can be calculated by dividing the fixed…

Answered: Gardens, Inc., prewashes, shreds, and…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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You are considering opening a copy service in thestudent union. You estimate your fixed cost at $15,000 and thevariable cost of each copy sold at $.01. You expect the sellingprice to average $.05.a) What is the break-even point in dollars?b) What is the break-even point in units? PX• • S7.23 An electronics firm is currently manufacturing anitem that has a variable cost of $.50 per unit and a selling priceof $1.00 per unit. Fixed costs are $14,000.
Calculate the number of package tours that must be sold to break even.The general manager at Lifetime Escapes proposes to increase the price of the package tour to $8,200 to decrease the breakeven point in units. Using information in the original problem, calculate the new breakeven point in units. What factors should the general manager consider before deciding to increase the price of the package tour?
Elise and her friend Eloi developed an online car repair training course and sell it for $67.50 per course. The contribution margin per course is $23.00 and to break-even they need to have a total revenue of $32,000.00 per annum. a. What is the break-even volume? Round up to the next whole number b. What is the fixed costs per annum? Round to the nearest cent c. What is the total revenue if they sell 3,050 courses this year?
Eastman Publishing Company is considering publishing an electronic textbook about spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and website construction is estimated to be $160,000. Variable processing costs are estimated to be $6.00 per book. The publisher plans to sell single-user access to the book for $46. a. Build a spreadsheet model to calculate the profit/loss for a given demand. For example, what profit can be anticipated with a demand of 3500 copies? b. Use a data table to very demand from 1000 to 6000 in increments of 200 to assess the sensitivity of profit to demand. c. Use Goal Seek to determine the access price per copy that the publisher must charge to break even with the demand of 3500 copies. Before you move on to Problem 2, make sure you save your workbook with this value displayed or else you will not receive credit.
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