Lake Stevens Marina has estimated that fixed costs per month are$350,000andvariable cost per dollar of sales is $0.30. The selling price per dollar of sales is:$1.00Determine the effect on the break-even point in sales dollars considering each of the following independently. 1. Total fixed costs increase to $365,000. Break-even point = ÷ = 2. Variable costs decline to $0.25 per sales dollar. Break-even point = ÷ = 3. The anticipated sales volume increases to $1,100,000. Break-even point = ÷ = Comment on the BEPs from the above analyses in questions 1,2,3.

The Break-even point is the point where the production cost and revenue gained from selling the…

Answered: Determine the effect on the break-even…

Marketing

20th Edition

ISBN:9780357033791

Author:Pride, William M

Publisher:Pride, William M

Chapter19: Pricing Concepts

Section: Chapter Questions

Problem 6DRQ

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Lake Stevens Marina has estimated that fixed costs per month are	$350,000	and
variable cost per dollar of sales is	$0.30	. The selling price per dollar of sales is:	$1.00

Determine the effect on the break-even point in sales dollars considering each of the following independently.

1. Total fixed costs increase to $365,000.

Break-even point =	÷	=

2. Variable costs decline to $0.25 per sales dollar.

Break-even point =	÷	=

3. The anticipated sales volume increases to $1,100,000.

Break-even point =	÷	=

Comment on the BEPs from the above analyses in questions 1,2,3.