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| Teaching Since: | May 2017 |
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MCS,MBA(IT), Pursuing PHD
Devry University
Sep-2004 - Aug-2010
Assistant Financial Analyst
NatSteel Holdings Pte Ltd
Aug-2007 - Jul-2017
Ch 5 Home Work
Lindon Company is the exclusive distributor for an automotive product that sells for $15.00 per unit and has a CM ratio of 30%. The company’s fixed expenses are $74,250 per year. The company plans to sell 14,000 units this year.
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Required:
1.          Â
What are the variable expenses per unit? (Round your answer to 2 decimal places.)
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2.           Use the equation method:
Â
       Â
Â
               Â
               Â
 3.         Repeat (2) above using the formula method.
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      b.   What amount of unit sales and dollar sales is required to earn an annual profit of $22,500?
       c.   Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $1.50 per unit. What is the company’s new break-even point in unit sales and in dollar sales?
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