Lush Lawn, Incorporated produces and sells electric lawn trimmers for $135 each. The variable costs...
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Lush Lawn, Incorporated produces and sells electric lawn trimmers for $135 each. The variable costs of each mower total $95 while total monthly fixed costs are $6,120. Current monthly sales are $49,500. The company is considering a proposal that will decrease the selling price by 20%, increase monthly fixed costs by 50%, and increase unit sales to 750 units per month.
Required:
Compute the company's current break-even point in units and dollars.
What is the company's current margin of safety in units, dollars, and percentage?
Lush Lawn, Incorporated produces and sells electric lawn trimmers for $135 each. The variable costs of each mower total $95 while total monthly fixed costs are $6,120. Current monthly sales are $49,500. The company is considering a proposal that will decrease the selling price by 20%, increase monthly fixed costs by 50%, and increase unit sales to 750 units per month. Required: a. Compute the company's current break-even point in units and dollars. b. What is the company's current margin of safety in units, dollars, and percentage
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