In its first year, A Company had the following data.

Question

Sales = 25,000 units Selling price = Birr 100
Total variable cost = Birr 1,500,000 TFC = Birr 350,000
Required:
A) Develop revenues, cost, and profit functions for the company in terms of quantity.
B) Find the break-even point in terms of quantity.
C) Find the break-even revenue.
D) If profit had been Birr 500,000 what would have been the sales volume (revenue) and the quantity of sales.
E) What would have been the profit if sales were Birr 2,000,000?

Answer 1

In its first year, A Company had the following data.
Sales = 25,000 units Selling price = Birr 100
Total variable cost = Birr 1,500,000 TFC = Birr 350,000
Required:
A) Develop revenues, cost, and profit functions for the company in terms of quantity.
B) Find the break-even point in terms of quantity.
C) Find the break-even revenue.
D) If profit had been Birr 500,000 what would have been the sales volume (revenue) and the quantity of sales.
E) What would have been the profit if sales were Birr 2,000,000?