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Lori approaches Pedro about creating a special wine for her daughter's upcoming wedding. Lori will buy 50 bottles of Pedro's wine, but the order will have fixed costs for special labeling and delivery
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Lori approaches Pedro about creating a special wine for her daughter's upcoming wedding. Lori will buy 50 bottles of Pedro's wine, but the order will have fixed costs for special labeling and delivery of $300o. What is the breakeven price Pedro will need to charge to breakeven on this special order?

User Sougata Bose
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1 Answer

2 votes

Answer:

New Break Even volume 74.42 or 74 units

Step-by-step explanation:

Assuming the following given data:

A . Fixed Cost $893

B . Sale price per bottle $28

C = $ 14 + 2= $16 ----> New Variable cost per bottle

D = B - C -----> New unit contribution margin $12

E = A/D -------> New Break Even volume 74.42 or 74 units

User Afterburner
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