The Shirt Works sells a large variety of tee shirts and sweatshirts. Steve Hooper, the...

90.2K

Verified Solution

Question

Accounting

The Shirt Works sells a large variety of tee shirts and sweatshirts. Steve Hooper, the owner, is thinking of expanding his
sales by hiring high school students, on a commission basis, to sell sweatshirts bearing the name and mascot of the
local high school.
These sweatshirts would have to be ordered from the manufacturer six weeks in advance and could not be returned
because of the unique printing required. The sweatshirts would cost Hooper $22.00 each with a minimum order of 248
sweatshirts. Any additional sweatshirts would have to be ordered in increments of 248.
Because Hooper's plan would not require any additional facilities, the only costs associated with the project would be
the costs of the sweatshirts and the costs of the sales commissions. The selling price of the sweatshirts would be
$44.00 each. Hooper would pay the students a commission of $5.00 for each shirt sold.
Required:
What level of unit sales and dollar sales is needed to attain a target profit of $16,864?
Assume that Hooper places an initial order for 248 sweatshirts. What is his break-even point in unit sales and dollar
sales?
Note: Round your intermediate calculations, round "Break-even point in unit sales" up to the nearest whole unit
and round "Break-even point in dollar sales" to the nearest whole dollar.
How many sweatshirts would Hooper need to sell to earn a target profit of $18,972?
Note: Round final answer up to the nearest whole unit.
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students