Rochester Rockets Ltd. plans to introduce a new model of hobby rocket. After extensive discussions with engineering, manufacturing, and marketing staff, the following information has been developed:
|
Quarter
|
1
|
2
|
3
|
4
|
5
|
6
|
7
|
8
|
|
Market research ($)
|
(10,000)
|
(20,000)
|
|
Product development ($)
|
(10,000)
|
(50,000)
|
(100,000)
|
(50,000)
|
|
Selling price/unit ($)
|
25
|
25
|
20
|
20
|
|
Variable costs/unit ($)
|
11
|
11
|
10
|
10
|
|
Sales quantity (units)
|
7,000
|
7,000
|
8,000
|
8,000
|
|
Other fixed costs ($)
|
(10,000)
|
(10,000)
|
(10,000)
|
(10,000)
|
Required: Calculate break-even time for the new product.