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Determine the high-low cost estimation and profit planning

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High-Low Cost Estimation and Profit Planning

Comparative 2007 and 2008 income statements for Dakota Products Inc. follow:

DAKOTA PRODUCTS INC.

Comparative Income Statements

For Years Ending December 31, 2007 and 2008

Unit sales                  2007: 5,000

                               2008: 8,000

Sales revenue          2007: $75,000

                             2008: $120,000

Expenses                2007: (82,000)

                           2008: (103,000)

Profit (loss)          2007: $(7,000)

                         2008: $17,000

Problem (a) Determine the break-even point in units.

Problem (b) Determine the unit sales volume required to earn a profit of $7,000.

Reference no: EM132460231

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