Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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    Phoniex University
    Oct-2001 - Nov-2016

Category > Accounting Posted 05 Aug 2017 My Price 7.00

variable cost in NewShoes i

I need help with the following question specifically #4 and #5

The variable cost in NewShoes is the unit cost of the product. Fixed costs are the marketing expenses for a region along with the allocated product development expense. Applying the formula with a variable cost of $40, and fixed expenses of $3,500,000, the break-even price for 100,000 units would be: break-even price = $40 + $3,500,000 / 100,000 = $40 + $35 = $75

1. Using the fixed expenses and projected sales from the example, what would the break-even price be if unit cost is $35?

2. If the break-even price is $75, and your target return on sales is 20%, what is the selling price?

- Use the following data for questions 3 & 4 - units sold $100.000 consumer promotions $1,800,000 unit cost $40 personal selling 5 salespeople @ $80,000 each target return on sales 10% dealer promotions $1,200,000 advertising $1,500,000 product development $700,000

3. Calculate the break-even price.

4. What would the selling price have to be to get the target return?

5. What other factors besides break-even should you consider before setting price?

Answers

Maurice Tutor
(5)
Status NEW Posted 05 Aug 2017 04:08 PM My Price 7.00

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