SOLUTION: The CALC Company makes basic scientific calculators. Each calsulator costs $2.75 to produce. The fixed costs of production are $11,500 per month. These calculators sell for $10.25

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Question 133151This question is from textbook Fundamentals of Algebric Modeling
: The CALC Company makes basic scientific calculators. Each calsulator costs $2.75 to produce. The fixed costs of production are $11,500 per month. These calculators sell for $10.25 each. If the company produces and sells 450,000 calculators in February, find the profit or loss for the month of February. This question is from textbook Fundamentals of Algebric Modeling

Found 2 solutions by vleith, checkley71:
Answer by vleith(2983) About Me  (Show Source):
You can put this solution on YOUR website!
Given: fixed costs 11500/month and per unit cost of 2.75. Sales price of 10.25. sales in units is 450,000
Profit+=+Sales+-+costs
Profit+=+10.25x+-+%28fixed+cost+%2B+variable+cost%29+
Profit+=+10.25x+-+%2811500+%2B+2.75x%29+
Profit+=+7.5x+-+11500+
Profit+=+7.5+%28450000%29+-+11500+
Profit+=+3375000+-+11500
Profit = 3,363,500 in Feb.
Man, we are in the wrong job :)

Answer by checkley71(8403) About Me  (Show Source):
You can put this solution on YOUR website!
11,500+2.75*450,000
11,500+1,237,500=1,249,000 cost of production.
10.25*450,000=4,612,500 selling price.
4,612,500-1,249,000=$3,363,500 is the profit for manufacturing & selling 450,000 calculators.