of production is P2.70. Total 0. The company is currently se

Entrepreneurial Finance
6th Edition
ISBN:9781337635653
Author:Leach
Publisher:Leach
Chapter4A: Nopat Breakeven: Revenues Needed To Cover Total Operating Costs
Section: Chapter Questions
Problem 1EP
icon
Related questions
Question
PE 3. One of the products produced by Kool Company is
Tanglad Tea. The selling price per 18-ml. bottle is P4.50, and
variable cost of production is P2.70. Total fixed costs per year
are P315,000. The company is currently selling 200,000 18-
ml. bottle per year.
3. If Kool Company can increase sales in units by 30 percent,
what percentage increase will it experience in income?
4. If the company increases advertising by P41,200, sales in
units will increase by 15%. What will be the new
breakeven point?
Transcribed Image Text:PE 3. One of the products produced by Kool Company is Tanglad Tea. The selling price per 18-ml. bottle is P4.50, and variable cost of production is P2.70. Total fixed costs per year are P315,000. The company is currently selling 200,000 18- ml. bottle per year. 3. If Kool Company can increase sales in units by 30 percent, what percentage increase will it experience in income? 4. If the company increases advertising by P41,200, sales in units will increase by 15%. What will be the new breakeven point?
Expert Solution
steps

Step by step

Solved in 3 steps

Blurred answer
Knowledge Booster
Income Statement Analysis
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Entrepreneurial Finance
Entrepreneurial Finance
Finance
ISBN:
9781337635653
Author:
Leach
Publisher:
Cengage