Oates Tannery Sells Boxes of Leather for $160

question 66

Essay

Oates Tannery sells boxes of leather for $160.The unit variable cost per case is $80 plus commission of 10%.Fixed manufacturing costs total $2,000 per month,while fixed selling and administrative costs total $4,016.
What is the breakeven point in boxes?

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Definitions:

Total Sales

The sum of all revenue generated from the sale of goods or services in a specific period before any deductions.

Exclusive Franchise

A licensing agreement giving a single franchisee the right to be the only provider of the franchisor's product or service in a specific geographical area.

Variable Selling

Variable selling refers to the costs associated with selling products that vary with the level of sales activities, such as commissions and shipping expenses.

Administrative Expense

Costs related to the general operation of a business, including executive salaries, legal and financial fees, and other overhead costs.