Tanck Manufacturing's sales slumped badly in 2011. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 547,100 units of product: Net sales $2,188,400; total costs and expenses $2,417,430; and net loss $229,030. Costs and expenses consisted of the amounts shown below. Total Variable Fixed
Cost of goods sold $1,983,730 $1,267,092 $716,638
Selling expenses 239,500 67,500 172,000
Administrative expenses 194,200 44,100 150,100
$2,417,430 $1,378,692 $1,038,738
Management is considering the following independent alternatives for 2012.
1. Increase unit selling price 16% with no change in costs, expenses, and sales volume.
2. Change the compensation of salespersons from fixed annual salaries totaling $30,850 to total salaries of $61,300 plus a 4% commission on net sales.
How can I Compute the break-even point in dollars for 2011???
Computing the break-even point in dollars under each of the alternative courses of action??
1. $
2. $