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apter 5 Exercises Help Save Mauro Products distributes a single product, a woven

ID: 2394024 • Letter: A

Question

apter 5 Exercises Help Save Mauro Products distributes a single product, a woven basket whose selling price is $12 per unit and whose variable expense is $11 per unit. The company's monthly fixed expense is $1,200. 1. Calculate the company's break-even point in unit sales 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.) 1 of 4 Next >

Explanation / Answer

Solution for First Question:-

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As per the information given in the question; Fixed Expenses = $1200 Selling price per unit = $12 Variable cost per unit = $11 Thus Contribution per unit (12 – 11) = $1 Formula of break-even point in unit sales = Fixed expenses / Contribution per unit