Reference no: EM132617244

Biggers Company, a retailing company with few retail outlets located in the city sells three products. Below are sales and costs data:

Product                            A               B                     C

Price                           $60       $100             $80

Variable cost per unit      $30         $ 50           $40

Expected sales (units) 3,000            1,200       1,800

• Total monthly fixed operating cost $150,000
• Expected monthly combine sales - 6,000 units

Problem A. Calculate how many units of Product A, Product B, and Product C to sell each month to break-even.

Problem B. Calculate how many Product A, Product B, and Product C need If Biggers Company monthly target after tax profit is $80,000, Biggers currently pay 20% tax rate.

Problem C. Due to the unforeseen Covid pandemic, retail sales industry was one of the hardest hit because of the MCO "Stay Home" policies. During this period Biggers total expected sales dropped by 50%, from 6,000 to 3,000 units per month. Recently authorities have lifted the MCO and consumers are coming back but still at a significantly lower numbers than normal. To boost monthly sales Bigger is thinking of doing a month long sales promotion of "buy four get one free". Biggers expect sales to increase from 3,000 units to 4,000 of Product A, B, and C combine units per month. (the free unit - Product A). Calculate the impact on overall monthly profit if Biggers went ahead with the sales promotion.