Please help to EXPLAIN (not just give answers), how to find each answer to the questions below...THANKS!
This is in accounting class, but I think math might work better
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Al is considering opening a gift shop. He has collected the following information:
Monthly rent: $2,800
Monthly sales salaries: $1,200
In addition to the sales salaries, Al intends to pay a 5% sales commission to his sales staff.
The cost of merchandise sold is expected to be 40% of sales.
1. Determine Al's break-even point (BEP) in monthly sales dollars.
2. Determine the monthly sales dollars required to earn $2000 profit per month.
3. Determine Al's BEP if he reduces rent by $200/month.
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For 4,5, and 6, assume:
*He's reduced his merchadise purchase cost by 10%.
*This will not effect the sale price of her product.
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4. Determine the new Contribution Margin Ratio.
5. What's the new BEP in monthly sales dollars?
6. What's the new sales amount needed for $2,000 profit?
2007-11-13
05:39:06
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3 answers
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asked by
mikeburman11
1
in
Mathematics