- 4.12 Octagon Company is considering introducing a new video camera. Its selling price s projected to be P1,000 per unit. Variable manufacturing costs are estimated to be P450 per unit The company expects the annual fixed manufacturing costs for the new camera to be P3,500,000 per year if its annual sales do not exceed the current regular shift capacity of 12,000 cameras and. P6,000,000 otherwise. Sales commissions are paid at 5% of sales. The company also plans to spend P1,000,000 per year on advertising. 000.08 aleo) enirbsm lsurmLA Instructions: 000,81 1. Determine the contribution margin per unit. 2. Determine the two break even points in terms of number of cameras sold per month. 3. Suppose a market research survey indicates that a 10% reduction in the selling price wil lead to a 20% increase in sales. Should the company reduce the price by 10%? Fobcoru coar ber po

- 4.12 Octagon Company is considering introducing a new video camera. Its selling price s projected to be P1,000 per unit. Variable manufacturing costs are estimated to be P450 per unit The company expects the annual fixed manufacturing costs for the new camera to be P3,500,000 per year if its annual sales do not exceed the current regular shift capacity of 12,000 cameras and. P6,000,000 otherwise. Sales commissions are paid at 5% of sales. The company also plans to spend P1,000,000 per year on advertising. 000.08 aleo) enirbsm lsurmLA Instructions: 000,81 1. Determine the contribution margin per unit. 2. Determine the two break even points in terms of number of cameras sold per month. 3. Suppose a market research survey indicates that a 10% reduction in the selling price wil lead to a 20% increase in sales. Should the company reduce the price by 10%? Fobcoru coar ber po

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 4P

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