IceLess is an anti-icing solution sold in gallon plastic jugs. It is poured into the windshield washer bottle of your car. Wash your windshield and the solution prevents the glass from icing over for about four hours. Production incurs the following fixed and variable costs. It is priced initially at $5.50 per gallon. Fixed costs (per year) Rent Utilities Managerial salaries Flammability permit Other fixed expense Total fixed $18000 13200 20000 12000 2400 $65600 Variable Costs per gallon Glycol FreezeFree 312 Mfg labor Packaging Inert ingredients Advertising Total $1.50 .50 .20 .20 .60 .30 $3.30 1. What is the annual breakeven production quantity (use above data, show work)?

IceLess is an anti-icing solution sold in gallon plastic jugs. It is poured into the windshield washer bottle of your car. Wash your windshield and the solution prevents the glass from icing over for about four hours. Production incurs the following fixed and variable costs. It is priced initially at $5.50 per gallon. Fixed costs (per year) Rent Utilities Managerial salaries Flammability permit Other fixed expense Total fixed $18000 13200 20000 12000 2400 $65600 Variable Costs per gallon Glycol FreezeFree 312 Mfg labor Packaging Inert ingredients Advertising Total $1.50 .50 .20 .20 .60 .30 $3.30 1. What is the annual breakeven production quantity (use above data, show work)?

Managerial Economics: A Problem Solving Approach

5th Edition

ISBN:9781337106665

Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor

Chapter4: Extent (how Much) Decisions

Section: Chapter Questions

Problem 4.2IP

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