Forecast of demand-find the break-even quantity

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Reference no: EM13928202

A producer of felt-tip pens has received a forecast of demand of 34,000 pens for the coming month from its marketing department. Fixed costs of $30,000 per month are allocated to the felt-tip operation, and variable costs are 36 cents per pen.

a. Find the break-even quantity if pens sell for $3 each.

b. At what price must pens be sold to obtain a monthly profit of $25,000, assuming that estimated demand materializes?

Reference no: EM13928202

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