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In 2017,Thorpe Company Has Sales of $1 600 000,variable Costs

question 48

Essay

In 2017,Thorpe Company has sales of $1 600 000,variable costs of $400 000,and fixed costs of $600 000.In 2018,the company expects annual property taxes to decrease by $30 000.
Required:
a.Calculate operating profit and the break-even point for 2017.
b.Calculate the break-even point for 2018.
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Definitions:

Deadweight Loss

Deadweight loss is a loss of economic efficiency that can occur when the free market equilibrium for a good or a service is not achieved.

MP-3 Player

A portable digital device designed to play audio files in the MP3 format, allowing for the storage and playback of music and other audio.

Tax

A compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.

Deadweight Loss

An economic inefficiency arising when a good or service fails to meet its free market equilibrium point.

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