Question

Fixed costs: $8,000Number of shoes produced (pairs): 10,000Unit cost of shoes (per pair): $5.75Price per shoe (pair): $9.50Number of shoes sold (pairs): 7,850Profit?

Answer 1

Profit = Selling price - cost price

The cost price for 10000 pairs of shoes is

`\begin{gathered} C=8000+10000(5.75) \\ \\ C=8000+57500 \\ \\ C=65500 \end{gathered}`

The cost price is $65500

The selling price of 7850 pairs of shoes is

`\begin{gathered} S=7850*9.50 \\ \\ S=74575 \end{gathered}`

The selling price is $74575

Subtract them to find the profit

`\begin{gathered} P=S-C \\ \\ P=74575-65500 \\ \\ P=9075 \end{gathered}`

The profit is $9075