Q:

need help filling in the blanks. (selling price and profit.)

Accepted Solution

A:
Answer:$7.73$131,450$9,500$9.44$12.44$4,590$107,600$-1,620Step-by-step explanation:Let's take it one at a time. To find the fixed costs per unit, we use the formula.[tex]FixedCostPerUnit=\dfrac{FixedCosts}{ForecastUnitSales}[/tex]So our variables are.Fixed Costs = $85,000Forecast = 11,000 unitsNow we compute.[tex]FixedCostPerUnit=\dfrac{85,000}{11,000}[/tex][tex]FixedCostPerUnit=$7.73[/tex]Now for the Gross Sales, we simply take the selling price per unit and multiply it to the forecast unit sales.GrossSales = Selling Price x Forecast Unit SalesGrossSales = $11.95 x 11,000GrossSales = $131,450To compute for the possible net profit, we use the formula:[tex]NetProfit=(SellingPrice-TotalCostPerUnit)*ForecastUnitSales[/tex]SellingPrice = $12.45TotalCostPerUnit = $11.50ForecastUnitSales = 10,000NetProfit = (12.45 - 11.50) x 10,000NetProfit = 0.95 x 10,000NetProfit = $9,500[tex]FixedCostPerUnit=\dfrac{FixedCosts}{ForecastUnitSales}[/tex]FixedCosts = $85,000ForecastUnitSales = 9,000[tex]FixedCostPerUnit=\dfrac{85,000}{9,000}[/tex]FixedCostPerUnit = $9.44Now that we have our Fixed Cost Per Unit we simply add our Variable Cost to get the Total Cost Per Unit.TotalCostPerUnit = FixedCostPerUnit + VariableCostTotalCostPerUnit = $9.44 + $3.00TotalCostPerUnit = $12.44Now for the Net Profit.[tex]NetProfit=(SellingPrice-TotalCostPerUnit)*ForecastUnitSales[/tex]SellingPrice = $12.95TotalCostPerUnit = $12.44ForecastUnitSales = 9,000NetProfit = (12.95 - 12.44) x 9,000NetProfit = 0.51 x 9,000NetProfit = $4,590Now we're looking for Gross Sales again, so we use:GrossSales = Selling Price x Forecast Unit SalesGrossSales = $13.45 x 8,000GrossSales = $107,600[tex]NetProfit=(SellingPrice-TotalCostPerUnit)*ForecastUnitSales[/tex]SellingPrice = $13.45TotalCostPerUnit = $13.63ForecastUnitSales = 8,000NetProfit = (13.45 - 13.63) x 8,000NetProfit = -0.18 x 9,000NetProfit = $-1,620So we can see that we have a profit loss at 8,000 units and a selling price of $13.45