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Neptune Company has developed a small inflatable toy it is anxious to introduce to its customers. The company's Marketing Department estimates demand for the new toy will range between

$15,000$ units and $35,000$ units per month. The new toy will sell for $$3$ per unit. Enough capacity exists in the company's plant to produce $18,000$ units of the toy each month. Variable expenses to

manufacture and sell one unit would be $$1\mathrm{.}00,$ and incremental fixed expenses associated with the toy would total $$22,000$ per month.

Neptune has also identified an outside supplier who could produce the toy for a price of $$1\mathrm{.}75$ per unit plus a fixed fee of $$15,000$ per month for any production volume up to $20,000$ units. For a

production volume between $20,001$ and $40,000$ units, the fixed fee would increase to a total of $$30,000$ per month.

Required:

Calculate the break$-$even point in unit sales assuming Neptune does not hire the outside supplier.

Note: Do not round your intermediate calculations.

How much profit will Neptune earn assuming:

a$.$ It produces and sells $18,000$ units?

b$.$ It does not produce any units and instead outsources the production of $18,000$ units to the outside supplier and then sells those units to its customers?

Calculate the break$-$even point in unit sales assuming Neptune plans to use all of its production capacity to produce the first $18,000$ units it sells and also commits to hiring the outside supplier

to produce up to $17,000$ additional units.

Assume Neptune plans to use all of its production capacity to produce the first $18,000$ units it sells and also commits to hiring the outside supplier to produce up to $17,000$ additional units.

a$.$ What total unit sales would Neptune need to achieve to equal the profit earned in requirement $2a?$

b$.$ What total unit sales would Neptune need to achieve to attain a target profit of $$16,500$ per month?

c$.$ How much profit will Neptune earn if it sells $35,000$ units per month?

requirement $3?$

If Neptune outsources all production to the outside supplier, how much profit will the company earn if it sells $35,000$ units?

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