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problem: West Publishing Company is doing an analysis of a proposed new finance text book. Use the following information, answer a through d.

Fixed costs per edition:











Variable costs per copy:




Admin costs 



Sales comm. 


2% of selling price



12% of selling price



20% of selling price




Projected selling price $30.00
Tax rate is 40 percent
[A] find out the firm's breakeven volume for the book
i. in unit's
ii. in dollar sales

[B] Make a breakeven chart for the text book

[C] find out the number of copies they must sell to earn an operating profit of $21,000 on this book

[D] Assume East feels that $30 is too high a price to charge. It examined the market and determined that $24.00 would be better. Determine the break even volume be at the new price? 

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  • Category:- Basic Finance
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