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Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
Edition 1ISBN: 978-0538736787 Exercise 51
BREAK-EVEN IN UNITS
Shellenberger Company manufactures high-end gas grills. Fixed costs amount to $19,980,000 per year. Variable costs per gas grill are $395, and the average price per gas grill is $950.
Required:
1. How many gas grills must Shellenberger Company sell to break even?
2. If Shellenberger Company sells 41,000 gas grills in a year, what is the operating income?
3. If Shellenberger Company's variable costs increase to $420 per grill while the price and fixed costs remain unchanged, what is the new break-even point? (Round up to the next higher whole unit.)
Shellenberger Company manufactures high-end gas grills. Fixed costs amount to $19,980,000 per year. Variable costs per gas grill are $395, and the average price per gas grill is $950.
Required:
1. How many gas grills must Shellenberger Company sell to break even?
2. If Shellenberger Company sells 41,000 gas grills in a year, what is the operating income?
3. If Shellenberger Company's variable costs increase to $420 per grill while the price and fixed costs remain unchanged, what is the new break-even point? (Round up to the next higher whole unit.)
Explanation
Verified
Verified
1.
Break-Even point:
It is a point at ...
Cornerstones of Cost Accounting 1st Edition by Don Hansen,Maryanne Mowen
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