Help 200 points for every one sold to an intenational charit

Help 2.00 points for every one sold to an intenational charity to provide to a child in need. The customer pays the shipping cost for ibems purchased, but the company pays to ship to the intermational charities $4.00 per unit $3.50 per unit Round your answers to 2 decimal places.)

Solution

Total variable cost = 4 + 3.5 + 0.60 + 4 = $ 12.10

Selling Price = 35

Question 1 (a) Contribution margin per unit = Selling Price - Variable cost = 35 - 12.10 = 22.90 per unit

Question 1 (b) Contribution lost = varible cost invested in the product = -12.10 per Unit

Question 1(c) Weighted average contribution = 22.90 * 1/2 + ( - 12.10 * 1/2) = 5.4 per unit

Question 1 (d) Total number of units to be sold to breakeven = Fixed cost / Weighted average contribution per unit.

= 140,600 / 5.4 per units

= 26037.03............ this must be rounded to next even number, since number sold = number donated

= 26038

Question - 2

If the target profit = 23,300, we need a total contribution of 140,600 + 23300 = 163,900

Weighted average Contribution per unit needed = 163900 / 11000 shirts = 14.90 per Unit

Let X = Selling price of the shirt needed

(X - 12.10) * 1/2 + ( -12.10)*1/2 = 14.90

(X - 12.10) * 1/2 = 20.95

(X - 12.10) = 41.9

X = 54 per unit ..................is the final answer

Question - 3

If Selling price = 45, we have weighted average contribution per unit = (45-12.10) * 1/2 + ( - 12.10 * 1/2) = 10.40

Total number of units sold = 22000 units ( i.e 11000 + 11000)

Profit = 22000 * 10.40 - 140600 = 88,200

If Selling price = 65, we have weighted average contribution per unit = ( 65 - 12.10) * 1/2 + ( - 12.10 * 1/2) = 20.40

Total number of units sold = 13000 ( i.e 6500 + 6500)

Profit = 13000 * 20.4 - 140600 = 124600

So we should select the profit maximizing price = 65..........final answer

Sold	13019
Donated	13019
Total	26038