Breed Products has performed extensive studies on its costs and production and estimates the following annual...
Breed Products has performed extensive studies on its costs and production and estimates the following annual costs based on 167,000 units (produced and sold):
Total Annual Costs (167,000 units)
Direct material $ 293,000
Direct labor 251,000
Manufacturing overhead 209,000
Selling, general, and administrative 141,000
Total $ 894,000
Required:
a. Compute Breed’s unit selling price that will yield a profit of $525,500, given sales of 167,000 units. (Round your answer to 2 decimal places.)
b. Compute Breed’s dollar sales that will yield a projected 25 percent profit on sales, assuming variable costs per unit are 56 percent of the selling price per unit and fixed costs are $408,500.
c. Management believes that a selling price of $7.40 per unit is reasonable given current market conditions. How many units must Breed sell to generate the revenues (dollar sales) determined in requirement (b)? (Round your final answer to nearest whole unit.)
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Breed Products has performed extensive studies on its costs and
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