1. Diamante Water is bottled in Italy and then shipped to Canada for sale. Diamante incurs the following costs in the production and shipping of their bottled water:
Cost
Water --- $0.05 per bottle
Packaging----$0.11 per bottle
Shipping--- $0.02 per bottle
Importation duties/taxes---- $0.02 per bottle
Charitable donation------$0.10 per bottle
Warehouse rental----- $50,000
Marketing and promotion------ $50,000
Other fixed costs--------$25,000
Diamante sells its water through speciality cafés and specialty retail/grocery outlets such as Whole Foods. Diamante sells its bottles to the stores in a case of 24 units. Each case of 24 bottles is sold to the store for $12.00. One bottle sells to the end customer for $2.00.
Using the information provided calculate the following for Diamante:
1. What price are they charging per bottle?
2. What are the total fixed costs?
3. What are the variable costs per unit?
4. What is the Contribution Margin per unit?
5. What is the Contribution Margin %
6. Breakeven in Units?
7. Breakeven in Sales?