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Derby Phones is considering the introduction of a new model of headphones with the following...

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Question

Accounting

Derby Phones is considering the introduction of a new model of headphones with the following price and cost characteristics.

Sales price $ 350 per unit
Variable costs 90 per unit
Fixed costs 650,000 per month

Required:

a. What number must Derby sell per month to break even?

b. What number must Derby sell to make an operating profit of $364,000 for the month?

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