SOLUTION: 1) The Superior Jumpdrive Company sells jump drives for $10 each. Manufacturing cost is $2.60 per jump drive; marketing costs are $2.40 per jump drive; and royalty payments are 20%

Question 992276: 1) The Superior Jumpdrive Company sells jump drives for $10 each. Manufacturing cost is $2.60 per jump drive; marketing costs are $2.40 per jump drive; and royalty payments are 20% of the selling price. The fixed cost of preparing the jump drive is $18 000. Capacity is 15 000 jump drives.
a) Compute:
i) the contribution margin
ii) the contribution rate
b) Compute the break-even point:
i) in units
ii) in dollars
iii) as a percent of capacity
c) Determine the break-even point in units if fixed costs are increased by $1600, while manufacturing cost is reduced by $0.50 per jump drive.
d) Determine the break-even point in units if the selling price is increased by 10%, while fixed costs are increased by $2900.
Answers:
a)
i) $3.00
ii) 30%
b)
i) 6000
ii) $60 000
iii) 40%
c) 5600
d) 5500
Answer by solver91311(24713) (Show Source): You can put this solution on YOUR website!

This is an accounting question. You are on the wrong website to get help with this type of work.

John

My calculator said it, I believe it, that settles it

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