Healthy Foods Inc.

strong Foods Inc. 1 powerful Foods Inc. Robert Johnson FIN /200 - accession To finance: Harvesting The Money Tree 8/12/2011 instructor: Joseph Lane Healthy Foods Inc. 2 Healthy Foods, Inc., sells 50-pound bags of grapes to the phalanx for $10 a bag. The stubborn cost of this operation be $80,000, while the variable costs of the grapes are $.10 per pound. a.What is the break-even point in bags? $80, 000 $80,000 BE = $10-$5 = $5 = 16,000 bags b.Calculate th e profit or overtaking on 12,000 bags and on 25,000 bags.

Total Variable Fixed be Total be Total Revenue Operating Income Costs (TVC) (FC) (TC) (TR) (loss) (12,000 x $5) (12,000 x $10) $60,000 $80,000 $140,000 $120,000 ($20,000) (25,000 x $5) (25,000 x $10) $ 125,000 $80,000 ! $205,000 $250,000 $45,000 c. What is the degree of in operation(p) leverage at 20,000 bags and at 25,000 bags? Why does the degree of run leverage transmit as the quantity sold increases? 20,000($10 - $5) $100,000 trade union movement= 20,000($10-$5) - $80,000 = $20,000 = 5 25,000($10 - $5) $125,000 lying-in = 25,000($10-$5)- $80,000 = $45,000 = 2.8 Because the father away you get from the breakeven point the smaller the percentages is incommode to be that is why 20,000 bags has a higher percentage than 25,000 bags. d. If Healthy Foods has an annual...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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