Reference no: EM132601863
Data from the latest income statement of XYLEM Pt y Ltd for the last 12 months is extracted as follows. You need to customize the name and figures to make it unique.
Annual Volume 45,000 Units
Selling price per unit $85
Variable manufacturing cost per unit $45
Annual fixed manufacturing costs $250,000
Variable marketing and distribution costs per unit $15
Annual fixed non-manufacturing costs $350,000
Question 1: Calculate and interpret the break-even point in both dollars and units for 2019.
Question 2: Calculate and interpret the margin of safety in both units and sales dollars.
Question 3: Calculate and interpret the profit achieved in 2019.
Question 4: Changes in marketing strategy are planned for 2020. This would increase variable marketing and distribution costs by $10 per unit and reduce fixed non-manufacturing costs by $50,000 per year. Calculate the units that would need to be sold in 2020 to achieve the same profit as in 2019.