Question

Connelly, Inc., a manufacturer of quality electric ice cream makers, has experienced a steady growth in sales over the past few years. Since her business has grown, Jan DeJaney, the president, believes she needs an aggressive advertising campaign next year to maintain the company's growth. To prepare for the growth, the accountant prepared the following data for the current year: Variable costs per ice cream maker Direct labor Direct materials Variable overhead $ 17.00 20.50 8.50 Total variable costs $ 46.00 Fixed costs Manufacturing Selling Administrative $108,500 63,000 450,000 Total fixed costs $621,500 Selling price per unit Expected sales (units) $85.00 36,000 Required 1. If the costs and sales price remain the same, what is the projected operating profit for the coming year? Projected operating profit 782,500 2. What is the breakeven point in units for the coming year? (Round your answer up to the nearest whole number) Breakeven point 15,936 units

Answer 1

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