Smooth-n-Soft Soaps sells bars of three soaps: Gentle Goat Milk, Lavendar Soft, and Chamomile Clean. The company has annual fixed costs of $550,800. Last year, the company sold 7,600 bars of its soaps in the ratio of 4:4:2. Smooth-n-Soft's accounting department has compiled the following data related to the three soaps:
|
Gentle Goat Milk |
Lavendar Soft |
Chamomile Clean |
| Price per bottle |
$16 |
|
|
$24 |
|
|
$18 |
|
|
| Variable costs per bottle |
2 |
|
|
8 |
|
|
6 |
|
|
Required:
A. Calculate the total number of bars that must be sold for the company to break even. Round your intermediate computations to two decimal places. If required, round your answer to nearest whole number.
units
B. Calculate the number of bars of Gentle Goat Milk, Lavendar Soft, and Chamomile Clean that must be sold to break even. If required, round your answers to nearest whole number.
|
Total Units to be Sold |
| Gentle Goat Milk |
|
| Lavendar Soft |
units |
| Chamomile Clean |
units |
C. How might Smooth-n-Soft Soaps reduce its break-even point?