Question

Compute the break-even sales (units) under the proposed program for the

following year. Enter the final answers rounded to the nearest whole number.

Determine the amount of sales (units) that would be necessary under

Break-Even Sales Under Present and Proposed Conditions

Darby Company, operating at full capacity, sold 116,100 units at a price of $132 per unit during the current year. Its income statement for the current year is as follows:

Sales  $15,325,200Cost of goods sold  7,568,000Gross profit  $7,757,200Expenses:   Selling expenses$3,784,000  Administrative expenses3,784,000  Total expenses  7,568,000Income from operations  $189,200

The division of costs between fixed and variable is as follows:

 VariableFixedCost of goods sold70% 30% Selling expenses75% 25% Administrative expenses50% 50% 

Question

Compute the break-even sales (units) under the proposed program for the

following year. Enter the final answers rounded to the nearest whole number.

Determine the amount of sales (units) that would be necessary under

Break-Even Sales Under Present and Proposed Conditions

Darby Company, operating at full capacity, sold 116,100 units at a price of $132 per unit during the current year. Its income statement for the current year is as follows:

Sales  $15,325,200Cost of goods sold  7,568,000Gross profit  $7,757,200Expenses:   Selling expenses$3,784,000  Administrative expenses3,784,000  Total expenses  7,568,000Income from operations  $189,200

The division of costs between fixed and variable is as follows:

 VariableFixedCost of goods sold70% 30% Selling expenses75% 25% Administrative expenses50% 50% 

Management is considering a plant expansion program that will permit an increase of $1,320,000 in yearly sales. The expansion will increase fixed costs by $132,000, but will not affect the relationship between sales and variable costs.

Management is considering a plant expansion program that will permit an increase of $1,320,000 in yearly sales. The expansion will increase fixed costs by $132,000, but will not affect the relationship between sales and variable costs.

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