Variable costs for a product is $60 and fixed costs (including staff salaries, and maintenance) amount to $4000 per month. The price of product A is $113.

Question

The company operates only 26 days a month and produces 125 units per day. But during one-weekday demand was 115 units.
The cost of lost sales is $9 per unit. Leftover products can be sold for $50 per unit.
What was the revenue for this one weekday?

Answer 1

To calculate the revenue for that one weekday, we need to first determine how many units were sold and multiply that by the price of the product. The company produced 125 units, but the demand was only 115 units. This means only 115 units were sold.

Given that:

• Price of product A = $113 per unit
• Units sold = 115

Now, we can calculate the revenue for that one weekday:

\[ \text{Revenue} = \text{Units Sold} \times \text{Price per Unit} \]

\[ \text{Revenue} = 115 \times 113 \]

\[ \text{Revenue} = 12995 \]

Therefore, the revenue for that one weekday was $12,995.