Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. plasiderm, inc., sells a medical product. the comp

Plasiderm, Inc., sells a medical product. The company is currently selling the product for $18/unit...

60.1K

Verified Solution

Question

Accounting

image
Plasiderm, Inc., sells a medical product. The company is currently selling the product for $18/unit and is considering whether it could increase profits by increasing the product's price to $20/unit. Plasiderm currently sells 50,000 units per week. Its current weekly operating data are as follows: Sales revenue $900,000 Variable costs $400,000 Fixed costs $250,000 Pretax profit $250,000 You can assume that per-unit variable costs do not vary with the level of production. (a) What is the breakeven sales level for the price increase that Plasiderm is considering? Explain what this breakeven sales level means. (b) If the sales level for this product decreased by 5,000 units per week after the price increase, what would be the change in Plasiderm's weekly pretax profits caused by the price increase? (c) What would be Plasiderm's profit change if, after the price increase, sales remained at 50,000 units per week

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

A nozzle is is designed to achieve M=4 under expanded exit flow conditions. For the given...

Mechanical Engineering
Q

Patients arrive at Max hospital for X-ray according to a Poisson process. There is an X-ray...

Basic Math
Q

Two capacitors connected in parallel having the capacities C? and C? are given 'q' charge,...

Physics
Q

18 Find the area of the sector of the circle 90 ft O100 ft O...

Geometry
Q

13 using the diagram KJ 9 below D find KJ

Geometry
Q

Solve the system by the method of your choice.x+2y = 324x+y = 18

Basic Math
Q

Differentiate the given function f x xe x3 O O O O f x e...

Calculus
Q

Solve the equation 5 4 C 3 1 8

Algebra
Q

Directions: Below is a news article about WorldCom. Answer the five questions below related to...

Accounting
Q

Suppose an organization intends to give you a short-term contract to carry out linear measurements...

Accounting
Q

Federal unemployment compensation tax (FUTA) is not withheld from employees' gross earnings. True...

Accounting
Q

5. Call Options Consider a 1-period binomial model with R 1.02, So 100, 0/1 point...

Finance