For the current year ending January 31, Harp Company expects fixed costs of $188,500 and a unit variable cost of $51.50. For the coming year, a new wage contract will increase the unit variable cost to $55.50. The selling price of $70.00 per unit is expected to remain the same.
(a)Compute the break-even sales
(units) for the current year. Round answer to the nearest whole number.
(b)Compute the anticipated break-even sales
(units) for the coming year, assuming the new wage contract is signed.

Question

For the current year ending January 31, Harp Company expects fixed costs of $188,500 and a unit variable cost of $51.50. For the coming year, a new wage contract will increase the unit variable cost to $55.50. The selling price of $70.00 per unit is expected to remain the same.
(a)Compute the break-even sales 
(units) for the current year. Round answer to the nearest whole number.
(b)Compute the anticipated break-even sales 
(units) for the coming year, assuming the new wage contract is signed.

Quizplus · Accepted Answer

The Answer of For the current year ending January 31, Harp Company expects fixed costs of $188,500 and a unit variable cost of $51.50. For the coming year, a new wage contract will increase the unit variable cost to $55.50. The selling price of $70.00 per unit is expected to remain the same.
(a)Compute the break-even sales 
(units) for the current year. Round answer to the nearest whole number.
(b)Compute the anticipated break-even sales 
(units) for the coming year, assuming the new wage contract is signed.

For the Current Year Ending January 31, Harp Company Expects