Assignment Task: Facing greater consumer concern about sugar in prepared foods, a Canadian syrup manufacturer developed a new product called Guiltless Syrup. This product is basically regular maple syrup with less than half the sugar, but with added cinnamon and brown sugar flavouring. Focus groups indicate that the product would be very popular once people tasted it. The manufacturer planned on selling the maple syrup in a 250ml squeezable plastic bottle.
Test marketing indicates that consumers would be willing to pay somewhere between $4.29 and $5.29 per bottle. Recognizing that it had to allow reasonable margins for wholesalers and retailers, the manufacturer finally decided on a suggested price to consumers of $4.89 per bottle and a markup to retailers of 20%. The variable cost of producing Guiltless Syrup was $2.96 per bottle, and it was packaged 24 bottles per case. Fixed costs that the manufacturer allocated for this product totalled $55,000.
a. What is the manufacturer's breakeven volume in cases?