. You\' re the manager for a new line of shoes that are being produced. There is
ID: 2560964 • Letter: #
Question
. You' re the manager for a new line of shoes that are being produced. There is a fixed cost for the equipment needed to manufacture these shoes. There is also a cost for each shoe manufactured. You are also given the selling price for each shoe. For each case below that provides the fixed cost, cost to manufacture each shoe, and the selling price for each shoe, state the number of shoes that need to be produced to break even. (2 Points Each) a. Fixed Cost: $1,500 Cost per Shoe: $50 Selling price per Shoe: $75 b. Fixed Cost: $1,000 Cost per Shoe: $50 Selling price per Shoe: $75 c. Fixed Cost: $1,500 Cost per Shoe: $50 Selling price per Shoe: $100 d. Fixed Cost:$1,500 Cost per Shoe: $60 Selling price per Shoe: $80 e. Fixed Cost: $2,000 Cost per Shoe: $50 Selling price per Shoe: $90Explanation / Answer
A. Contibution Per Shoe = Selling Price Per Shoe - Cost Per Shoe
= $ 75 - $ 50
= $ 25
Number of Shoe to be produce For Break Even = Fixed Cost / Contribution Per Shoe
= $ 1500 / $ 25
= 60 Shoe to be Produced
B. Contibution Per Shoe = Selling Price Per Shoe - Cost Per Shoe
= $ 75 - $ 50
= $ 25
Number of Shoe to be produce For Break Even = Fixed Cost / Contribution Per Shoe
= $ 1000 / $ 25
= 40 Shoe to be Produced
C. Contibution Per Shoe = Selling Price Per Shoe - Cost Per Shoe
= $ 100 - $ 50
= $ 50
Number of Shoe to be produce For Break Even = Fixed Cost / Contribution Per Shoe
= $ 1500 / $ 50
= 30 Shoe to be Produced
D. Contibution Per Shoe = Selling Price Per Shoe - Cost Per Shoe
= $ 80 - $ 60
= $ 20
Number of Shoe to be produce For Break Even = Fixed Cost / Contribution Per Shoe
= $ 1500 / $ 20
= 75 Shoe to be Produced
E. Contibution Per Shoe = Selling Price Per Shoe - Cost Per Shoe
= $ 90 - $ 50
= $ 40
Number of Shoe to be produce For Break Even = Fixed Cost / Contribution Per Shoe
= $ 2000 / $ 40
= 50 Shoe to be Produced
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