1. What would be the BEP in units sales if the company decides to:Increase the...
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1. What would be the BEP in units sales if the company decides to:Increase the sales price from $100 to $105 by spending annually $5000 for advertisement? 2. What would be the BEP in units sales if the company decides to:Increase the sales price from $100 to $105 and cutting the fixed salary of the salespeople by $15000 and instead provides them $10 per unit commission?3. Which one of the following options provides better units BEP for the company?Option A: Increase the sales price from $100 to $105 by spending annually $5000 for advertisementOptionB:Increase the sales price from $100 to $105 and cutting the fixed salary of the salespeople by $15000 and instead provides them $10 per unit commission.a) option Ab) option Bc) both options are samed) None of the options
Use the available pick lists from within the three boxed areas to change values, noting how the break-even units change within the green-shaded area. Think critically about why the changes in break-even units are occuring based on your revised assumptions. BEFORE AFTER Sales price per unit 100 100 Variable costs per unit 80 80 Total fixed cost 50,000 50,000 Break-even in units 2,500 2,500
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