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    ABM Innovations Inc. currently sells a product for P120 per unit with variable costs of P40 per unit and sells 100,000 units annually for a monthly profit of P300,000. A new design will increase variable costs by 20% and fixed costs by 10% while increasing sales to 120,000 units per month. The summary asks: (a) At what selling price will the company break even? (b) What will the monthly profit be if the selling price remains P120 per unit?

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    CHAPTER-3-BREAKEVEN

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    ABM Innovations Inc. currently sells a product for P120 per unit with variable costs of P40 per unit and sells 100,000 units annually for a monthly profit of P300,000. A new design will increase variable costs by 20% and fixed costs by 10% while increasing sales to 120,000 units per month. The summary asks: (a) At what selling price will the company break even? (b) What will the monthly profit be if the selling price remains P120 per unit?

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    6 views1 page

    Chapter 3 Breakeven

    Uploaded by

    nowhorez
    ABM Innovations Inc. currently sells a product for P120 per unit with variable costs of P40 per unit and sells 100,000 units annually for a monthly profit of P300,000. A new design will increase variable costs by 20% and fixed costs by 10% while increasing sales to 120,000 units per month. The summary asks: (a) At what selling price will the company break even? (b) What will the monthly profit be if the selling price remains P120 per unit?

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    Business Case: Chapter 3

    ABM Innovations Inc. currently sells a product for P 120 per unit. The variable costs are P 40
    per unit, and 100,000 units are sold annually and a profit of P 300,000 is realized per month. A
    new design will increase the variable costs by 20% and Fixed Costs by 10% but sales will
    increase to 120,000 units per month.
    (a) At what selling price does the company will have to break even, and
    (b) If the selling price is to be kept same (P120/unit) what will the monthly profit be?

    Task: Prepare a Business Case Analysis using the following format:


    I. Statement of the Problem
    II. Objectives
    III. Analysis
    IV. Conclusion
    V. Recommendation

    Paper Format:
    SHORT Bondpaper
    Margins (in inches): Left – 1.5 all other sides – 1
    Font: Bookman Old Style
    Transparent Folder
    Color Coding ABM A- BLUE
    ABM B- RED
    ABM C- PINK
    ABM D- WHITE/TRANSPARENT
    ABM E- YELLOW
    ABM F- VIOLET

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