SOLUTION: Assume the following facts for your company: Average shirt sales price 67 dollars, wholesale price per shirt 30 dollars and fixed costs are 100,000 dollars. If your wholesale shir
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Question 161310: Assume the following facts for your company: Average shirt sales price 67 dollars, wholesale price per shirt 30 dollars and fixed costs are 100,000 dollars. If your wholesale shirt supplier raised the wholesale price 10 percent and the fixed costs remain unchanged at 100,000 dollars what would be your breakeven point. Answer by ankor@dixie-net.com(22740) (Show Source):
You can put this solution on YOUR website! Assume the following facts for your company: Average shirt sales price 67 dollars, wholesale price per shirt 30 dollars and fixed costs are 100,000 dollars. If your wholesale shirt supplier raised the wholesale price 10 percent and the fixed costs remain unchanged at 100,000 dollars what would be your break-even point.
:
An increase of 10% means wholesale shirts cost $33 instead of 30
:
Let x = no. of shirt that need to be sold to break even
:
Revenue = cost
67x = 33x + 100000
67x - 33x = 100000
34x = 100000
x =
x = 2941.176 ~ 2,942 shirts sold to break even
;
:
Check solution
67(2942) = 33(2942) + 10000
197,114 ~ 97,086 + 100000 (we rounded up the no. of shirts)
