XYZ company is considering making a capital investment of $175,000 that will allow them to produce a high quality screw driver for home and professional use.
Variable costs are expected to be $8 per hammer and they have forecast sales of 11,000 hammers.
What is the lowest price that they can afford to sell these hammers?
What should the price be for breakeven to occur at 7,000 units?
If XYZ desires a selling price of $30 and they also want breakeven units to be 5,000, what would the variable costs need to be?