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What is big wave break-even point in sales dollars

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Big Wave Corporation sells two types of surfboards. They sell the Sunrise for $1,000. Each Sunrise board has a variable cost of $250 per unit. They also sell the Sunset surfboard. They believe they can sell each Sunset board for $1,500 and estimate it will cost $500 to make each board. The company expects to incur $1,400,000 in fixed expenses. Initial sales estimates indicate that Big Wave customers will buy 1 Sunset board for every 4 Sunrise boards.

Problem 1: What is Big Wave's break-even point in units for Sunrise boards and Sunset boards?

Problem 2: What is Big Wave's break-even point in sales dollars?

Problem 3: If Big Wave has a target profit of $1,000,000, how many Sunrise boards and Sunset boards must they sell?

Reference no: EM132804103

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