Bleeker Street Company Produces and Sells Two Lines of Business

question 89

Essay

Bleeker Street Company produces and sells two lines of business suits,the Contemporary and the Traditionalist.The following monthly data are provided:
$$\begin{array} { l c c } & \text { Contemporary } & \text { Traditionalist } \\\text { Estimated unit sales per month } & 500 & 1,000 \\\text { Selling price } & \$ 200 & \$ 175 \\\text { Variable marnufacturing costs } & 110 & 100 \\\text { Variable selling and adrninistrative costs } & 10 & 10\end{array}$$ Budgeted net income is $45,000 per month.
Required:
1)Calculate the monthly break-even sales in units and dollars based on the budgeted sales mix.
2)Calculate the firm's overall margin of safety in dollars.
3)Compute the firm's profit assuming 1,500 units are sold in a 1:1 sales mix.
4)Explain any difference between the firm's budgeted net income of $35,000 and your answer to Requirement 3.

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.