Question - Will you please help me with this problem? Please show the work so that I can understand it.
Please use the following data from XYZ, Inc. manufacturer of an industrial air compressor to answer the questions below:
Based upon a production of 5,000 units, the company data is as follows:
Cost for 5,000 Units
Variable materials............................................................ $100
Variable labor............................................................................... $150
Variable factory overhead........................................................... $50
Fixed factory overhead.......................................................... $200
Variable marketing costs........................................................ $50
Fixed marketing costs............................................................ $140
a) Assuming the units sell for $800, what is the breakeven sales amount in terms of dollars and units?
b) If unit sales could be increased to 5,500 by lowering the price to $750, would the company be better off than it is now (at 5,000 units)? Explain.