Anke Perks is opening an arts and crafts store that focuses on canvases, paints, and pencils. The selling price of a canvas is $24. The variable operating costs are $14 per canvas while the fixed operating costs are $4,000.
a. Calculate how many canvases Anke needs to sell to reach her operating break even point.
b. Calculate the total operating costs at the breakeven point based on part a.
c. Anke’s business plan assumed that she would be able to sell 420 canvases per month. Will Anke be able to make a profit at this sales level?
d. How much EBIT will Anke generate if she sells 420 canvases per month