Reference no: EM132567105
Question - Sands & Sands is a manufacturer of fertilizers in Venezuela. It currently sells speciality fertilizers in the Caribbean. A bag of fertilizer is sold to wholesalers for $5,450 and its variable costs is $3,900 and fixed costs is $25,000,000 annually:
Using the information provided.
a) How many bags of fertilizer must the company sell in order to break even and what is the breakeven revenue?
b) The company sold 1,550,000 bags last year. What was its profit?
c) Due to inflation, next year's fixed costs are expected to rise to $28,000,000. What will be the NEW break-even quantity and revenue?
d) If the company will sell the number of units obtained in part (c) and wants to maintain the same profit as last year, what will its new price have to be?
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