Breakeven Analysis
A. Calculate the breakeven (with profit) volume given the
information below. Create an income statement proving your
calculated volume produces the desired profit. What will happen to
profit if actual volume is 10 cases more than breakeven volume? AVC
= $2,500 TFC = $1,200,000 Profit = $100,000 Price = $4,320
B. Calculate breakeven volume if total fixed cost increases by
8%.
C. Calculate breakeven volume if average variable cost increases
by 5% with the original (part A) TFC.