Question

BREAK-EVEN ANALYSIS

The Warren Watch Company sells watches for $28, fixed costs are $195,000, and variable costs are $13 per watch.

1. What is the firm's gain or loss at sales of 8,000 watches? Enter loss (if any) as negative value. Round your answer to the nearest cent.
   $
   What is the firm's gain or loss at sales of 19,000 watches? Enter loss (if any) as negative value. Round your answer to the nearest cent.
   $
2. What is the break-even point (unit sales)? Round your answer to the nearest whole number.
   units
3. What would happen to the break-even point if the selling price was raised to $33?
   -Select: The result is that the break-even point remains unchanged. The result is that the break-even point is lower. The result is that the break-even point is higher. Item 4
4. What would happen to the break-even point if the selling price was raised to $33 but variable costs rose to $21 a unit? Round your answer to the nearest whole number.
   -Select- The result is that the break-even point remains unchanged. The result is that the break-even point increases. The result is that the break-even point decreases.

Answer 1