Problem
Play Now sports manufactures plaques with Vladimir Guerrero Jr autograph stamped on them. Each plaque sells for $60. .
Costs for Play Now include
RENT $13,000
UTILITIES $12,000
INSURANCE $8,000
OFFICE STAFF SALARIES $12,000
MATERIAL COST FOR 1000 PLAQUES = $8,000
LABOUR COST FOR 1000 PLAQUES = $22,000
Task
a) Calculate their TOTAL FIXED COSTS.
b) Calculate the VARIABLE COSTS PER PLAQUE.
c) Compute the break-even point in units and in dollars.
d) Find the sales(in units) needed to earn a profit of $22,000.
e) If they sold 4,000 plaques, what is their gross profit margin and net profit margin?