What is the company breakeven in dollars

Reference no: EM13271212

Innovation products international is a health foods company which recently discovered that increasd soy isoflavones (at least 500 mg every 2 days) in a person's diet has been able to extend a person's life span by at least 20 years. The company developed a new product called "Soy for Life", which is a tasty breakfast bar that contains 500 mg of soy isoflavones in each bar. Cost of research and development for the product was $2,250,000. The breakfast bar market size is currently measured at 80 million units of which IPI serves 45%. Initial taste tests concluded that consumers are unable to make any taste distinctions between a regular breakfast bar and one that contains 500 mg of isoflavones. IPI plans to lunch this new breakfast bar initially across the United States using its current distribution channel of supermarket chains and health food stores which have 5,000 locations combined.

Innovation Product International's fixed costs is currently $1 million per year with the cost to produce each breakfast bar at 1.25$. The finding of several research studies has determined that consumers would be willing to pay 8.25$ for Soy for Life breakfast at which the retail selling price would be targeted. The retailer margine is 35% and then wholesale margin is 15%.

a. What is the company's selling price of one Soy for Life breakfast bar to its wholesalers? (from my calculations its 4.125$)
b. What is the product's contribution margin as a percentage?
c. What is the product's contribution per unit in dollars?
d. What is the company's breakeven in units?
e. What is the company's breakeven in dollars?
f. What is the company's breakeven sahre of market as a percentage?

Reference no: EM13271212

Questions Cloud

Define the standard enthalpy of formation of atomic hydrogen : Given that the standard enthalpy of formation of atomic hydrogen, H(g), is -219.0 kJ/mol, find the standard reaction enthalpy for the reaction H2(g) -> 2H(g) (calculate result in kJ/mol and give the numerical value)

Design an iir high-pass filter using bilinear method : design an IIR high-pass filter using bilinear method in a system with sampling frequency of 100 Hz. The lower and higher cutoff frequencies are at 18 Hz and 35 Hz respectively. Pre-warp the cutoff frequencies.

How might kimpton overcome them : How would you justify the EarthCare program to Kimpton's board of directors and stockholders? That is, what is the business case for this program?

Define the second order light of the same wavelength : At what angle would the second order light of the same wavelength be reflected on the same side of the normal to the grating as the incident of light

What is the company breakeven in dollars : Innovation Product International's fixed costs is currently $1 million per year with the cost to produce each breakfast bar at 1.25$.

Eliminate the filter output delay place two zeros at origin : Design a second-order band-pass IIR filter with center frequency of 200 Hz when the sampling frequency is 1000 Hz. In order to ensure the filter stability set the poles at 0.94 radial distant from the origin

Could any action be taken against myra personally : What possible legal grounds might the employees have to claim their entitlements from Clothing for Kids Pty Ltd and could any action be taken against Myra personally?

Explain how many grams of cesium are in compound : A compound of iodine and cesium contains 69.75 g of metal and 66.20 g of nonmetal. How many grams of cesium are in 38.52 g of compound? How many grams of iodine

Distinguish between required and excess reserves : what does the bank balance sheets look like? Distinguish between required and excess reserves.

User Account

All Pages