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Selling price and variable cost remain constant

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Reference no: EM132919559

Consider a firm that buys units for P10 and sells them for P15. There are no other variable cost. Fixed costs are at P6,000.

Use the break-even formula to determine the following:

a. TR, TC, and profit functions.

b. Sales volume when profit is P8,000.

c. Profit when sales are 500 units.

d. The break-even quantity and revenue.

e. The amount by which the variable cost per unit has to be decreased or increased in order to break even at 500 units. (Selling price and FC remain constant).

f. The new fixed cost in order to break even at 800 units. Selling price and variable cost remain constant.

g. The new selling price per unit, to break even at 500 units if VC and FC are constant.

Reference no: EM132919559

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