Abhinav Kumar Jain

1. Break-even point is when the total cost = total revenue. Let x be the number of units manufactured.
200,000 + 400,000 + 12x (which is the total variable cost of x units) = 20x (which is the total revenue)
This gives us x = 600,000/8 = 75,000 units.
2. Net income of 5,000 per month means the income of 60,000 in the year. Since net income is revenue minus cost, this means 20x - 12x - 600,000 = 60,000, where x is number of units sold.
This gives us x = 660,000/8 = 82,500 units.
3. A net income of 25% on cost means a net income of 0.25( 600,000 + 12x) = 150,000 + 3x
Similar to the previous question, we now get the equation
20x - 12x - 600,000 = 150,000 + 3x, which gives us
5x = 750,000 or x = 150,000 units
4. Let the selling price per unit be y. If 15,000 units bring down the breakeven point (i.e. x), it will be 60,000 units. Substituting that in the equation for breakeven point will give us
600,000 + 12(60,000) = 60,000y
Therefore, y = 22.