In: Accounting
4. CVP analysis; break-even: K-9’s Companions, Inc. operates a chain of pet supply stores that carry many styles of dog beds that are all sold at the same price.
The following data pertains to K-9’s Companions and is typical of the company’s many outlets:
Per dog bed |
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Selling price |
$ |
35.50 |
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Variable expenses: |
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Product costs (DM, DL, MOH) |
$ |
11.75 |
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Selling and admin costs |
3.15 |
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Total variable expenses |
$ |
14.90 |
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Annual |
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Fixed expenses: |
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Advertising |
$ |
17,350 |
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Depreciation |
18,000 |
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Administrative Salaries |
92,400 |
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Total fixed expenses |
$ |
127,750 |
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