Using the datain OM textProblem 5 on p.218, do the cost-volume analysis to answer the questions’a-e’ given here: (not the ones in the book). For eachquestion do these 4 tasks:
1)identify the formula used for the calculation either from the textbook pgs208-09 or from the list provided in the ‘Content’ Resources folder= Wk-04 Cost-Volume Formulas.8a.doc
2)set-up the calculation by inserting data into the formula chosen
3)solve the calculations for the answer
4)answer the management analysis question for each calculation.
a.What is the monthly breakeven in units if the price is $1.00 each? Inrevenue? Will the forecast sales be profitable?
b.What price must be charged to earn a monthly profit of $5,000 if the forecastis correct? Is this likely to be happen?
c.What volume is needed at a price of $1.00 to earn a monthly profit of $5,000?Is this likely to happen?
d.What volume is needed at a price of $1.00 to obtain a monthly profit of $.10per unit? Is this likely to happen?
e.What volume is needed at a price of $1.00 to obtain a monthly revenue of$20,000? Is this likely to happen?