Pick-Me-Up Company is introducing a new high caffeine coffee in its stores and must decide what price to set for the coffee beans. An estimated demand schedule for the product is as follows:Price1 Lb. units demanded$4.5085,600$6.0074,500$7.5056,000$9.0049,100$10.5034,800$12.0027,100 Estimated costs are as follows:Variable manufacturing costs per unit$1.50Fixed manufacturing cost per year$38,200Variable selling & administrative costs per unit$0.50Fixed selling & administrative costs per year$20,900 Prepare a schedule showing management the total revenue, total cost, and total profit or loss for each selling price.At what price do you recommend Pick-Me-Up Company should choose. Price$4.50$6.00$7.50$9.00$10.50$12.00Demand Total Revenue Variable Costs Fixed Costs Total CostsTotal Profit (Loss)

Total Demand (In LB Units)(A)856007450056000491003480027100Per unit Price(In…

Answered: total revenue, total cost, and total…

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total revenue, total cost, and total profit or loss for each selling price.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 1MC: The amount of a units sales price that helps to cover fixed expenses is its ____________________. A....

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Concept explainers

Risk Analysis

Risk management is the entire walkthrough process of helping the organization manage risks or avoid them altogether. It is an in-depth study to determine the risks and uncertainties faced by the business and how these impact the objectives and outcomes of the business. Risk analysis is a procedure of risk assessment followed by the management of an organization to avoid risks that may harm the functioning and efficiency of the company.

Question

Pick-Me-Up Company is introducing a new high caffeine coffee in its stores and must decide what price to set for the coffee beans. An estimated demand schedule for the product is as follows:

Price	1 Lb. units demanded
$4.50	85,600
$6.00	74,500
$7.50	56,000
$9.00	49,100
$10.50	34,800
$12.00	27,100

Estimated costs are as follows:

Variable manufacturing costs per unit	$1.50
Fixed manufacturing cost per year	$38,200
Variable selling & administrative costs per unit	$0.50
Fixed selling & administrative costs per year	$20,900

Prepare a schedule showing management the total revenue, total cost, and total profit or loss for each selling price.

At what price do you recommend Pick-Me-Up Company should choose.

Price
$4.50
$6.00
$7.50
$9.00
$10.50
$12.00
Demand Total Revenue Variable Costs Fixed Costs Total Costs
Total Profit (Loss)

Definition Definition Amount earned or lost on the sale of one or more items is referred to as the profit or loss on that item

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