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Required Information [The following information applies to the questions displayed below) The Fashion Shoe Company operates a
Required Information The following information applies to the questions displayed below.) The Fashion Shoe Company operates a
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Answer #1

for question 1 we will first calculate the break even unit

break even = fixed cost / (selling price - variable costs) = 195000 / (20-10) = 19500 units

extra units are 22700 - 19500 = 3200 units

commission = 3200 x .45 = $1440

total sales = 22700 x 20 = 454000

less variable cost @10 = 227000

less commission $1440

less fixed cost 195000

operating income $30560

break even = fixed cost / (selling price - variable costs) = 195000 +30400 / (20-6) = 16,100 units

break even in dollars = 16100 x 20 = $322000

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