Question

Goldberg-Scheinman Publishing Company is publishing a new managerial economics text for which it has estimated

following fixed and average variable costs:  Total Fixed Costs (Copyediting- 10,000, Typesetting 70,000, selling and promotion 20,000, TOTAL Fixed Costs- 100,000), Average Variable Costs (Printing and binding- 6, admin costs- 2, sales commission- 1, bookstore discounts- 7, author’s royalties- 4, Average Variable Costs- 20, project selling price- 30).  Find the publisher’s breakeven output and the output that would lead to a total profit of $60,000 and the total sales revenues at that output level; draw the cost-volume-profit chart. 

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