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Question - X Company sells one product. The following are the accountant's price and cost estimates for 2020:
Selling price $17.13
Direct materials 4.80
Direct labor [all variable] 1.57
Variable overhead 2.57
Variable selling and administration 2.50
Fixed overhead $10,400
Fixed selling and administration 13,800
Unit sales in 2019 were 5,200; unit sales in 2020 are expected to be 4,500. The accountant is uncertain about her $1.57 direct labor estimate. What must direct labor be in 2020 in order for X Company to breakeven (rounded to two decimal places)?
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