Marston Company sells a single product at a sales price of $50 per unit. Fixed costs total $15,000 per month, and vari-able costs amount to $20 per unit. If management reduces the sales price of this product by $5 per unit, the sales vol-ume needed for the company to break even will: a. Increase by $5,000. c. Increase by $2,000.b. Increase by $4,500. d. Remain unchanged.
Marston Company sells a single product at a sales price of $50 per unit. Fixed costs total $15,000 per month, and vari-able costs amount to $20 per unit. If management reduces the sales price of this product by $5 per unit, the sales vol-ume needed for the company to break even will: a. Increase by $5,000. c. Increase by $2,000.b. Increase by $4,500. d. Remain unchanged.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Marston Company sells a single product at a sales price of
$50 per unit. Fixed costs total $15,000 per month, and vari-
able costs amount to $20 per unit. If management reduces
the sales price of this product by $5 per unit, the sales vol-
ume needed for the company to break even will:
a. Increase by $5,000. c. Increase by $2,000.
b. Increase by $4,500. d. Remain unchanged.
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