Revenue Function

QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

Question

Agorwu Company produces office chairs. The price per chair is GHe99.75 and the variable cost per chair is GHe49.75. The following fixed costs are incurred:

Depreciation of plant and equipment per year	GHe20,000
Property taxes per year	GHe12,000
Manager’s salary and fringe benefits per month	GHe5,200

Perform a breakeven analysis of this company:

a. What is the total revenue function? (2 marks)

b. What is the total cost function? (2 marks)

c. What is the profit function? (2 marks)

d. What is the breakeven point in number of chairs? (2 marks)

e. What is the revenue at the breakeven point? (2 marks)

f. What is the income at the breakeven point? (2 marks)

g. Determine the profit when 1,500 chairs are produced in a year. (8 marks)

h. How many chairs must be sold for the company to make GHe75,000 in a year? (5 marks)

Answer

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Tags: Breakeven Point, Cost Function, Profit Calculation, Profit Function, Revenue Function
Level: Level 2

Series: JULY 2020

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

Question

The revenue function of a company is R = 48x + 3×2, and the cost function is
C = x2 + 46x + 180, where x is the number in units of item produced and
sold. Obtain the break-even quantity.

A. 8

B. 9

C. 10

D. 11

E. 12

Answer

Find Related Questions by Tags, levels, etc.

Tags: Break-even Analysis, Cost Function, Revenue Function
Level: Level 1

Topic: Mathematics
Series: MAY 2016

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

Question

Kyerewaa Ventures is a manufacturing company in the business of producing beverage cans for clients in the brewery industry. The weekly total cost to produce $x$ cans is given by:

The demand function for the cans is given by:

$P (x) = 200 - 0.005 x$

The company has set a production limit to 10,000 cans and it sells all the cans that are produced.

Required:
i) Derive an expression for marginal cost, marginal revenue, and marginal profit. (4 marks)
ii) Determine the cost, revenue, and profit when the 2,501st can is produced and sold. (3 marks)
iii) Determine the cost, revenue, and profit when the 7,501st can is produced and sold. (3 marks)
iv) Advise the company whether to produce the 2,501st can or the 7,501st can. (2 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Function, Marginal Cost, Marginal Profit, Marginal Revenue, Optimization, Revenue Function
Level: Level 1

Series: NOV 2017

QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

Question

Agorwu Company produces office chairs. The price per chair is GHe99.75 and the variable cost per chair is GHe49.75. The following fixed costs are incurred:

Depreciation of plant and equipment per year	GHe20,000
Property taxes per year	GHe12,000
Manager’s salary and fringe benefits per month	GHe5,200

Perform a breakeven analysis of this company:

a. What is the total revenue function? (2 marks)

b. What is the total cost function? (2 marks)

c. What is the profit function? (2 marks)

d. What is the breakeven point in number of chairs? (2 marks)

e. What is the revenue at the breakeven point? (2 marks)

f. What is the income at the breakeven point? (2 marks)

g. Determine the profit when 1,500 chairs are produced in a year. (8 marks)

h. How many chairs must be sold for the company to make GHe75,000 in a year? (5 marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: Breakeven Point, Cost Function, Profit Calculation, Profit Function, Revenue Function
Level: Level 2

Series: JULY 2020

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

Question

The revenue function of a company is R = 48x + 3×2, and the cost function is
C = x2 + 46x + 180, where x is the number in units of item produced and
sold. Obtain the break-even quantity.

A. 8

B. 9

C. 10

D. 11

E. 12

Answer

Find Related Questions by Tags, levels, etc.

Tags: Break-even Analysis, Cost Function, Revenue Function
Level: Level 1

Topic: Mathematics
Series: MAY 2016

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

Question

Kyerewaa Ventures is a manufacturing company in the business of producing beverage cans for clients in the brewery industry. The weekly total cost to produce $x$ cans is given by:

The demand function for the cans is given by:

$P (x) = 200 - 0.005 x$

The company has set a production limit to 10,000 cans and it sells all the cans that are produced.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Cost Function, Marginal Cost, Marginal Profit, Marginal Revenue, Optimization, Revenue Function
Level: Level 1

Series: NOV 2017

Question Tag: Revenue Function

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QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

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QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

You're reporting an error for "QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs"

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

You're reporting an error for "QTB – MAY 2016 – L1 – SA – Q6 – Mathematics"

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

You're reporting an error for "QT – Nov 2017 – L1 – Q6b – Elements of Calculus"

QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs

Define revenue, cost, profit functions; calculate breakeven, revenue/income at breakeven, profit at 1,500 units, and units for GHe75,000 profit

You're reporting an error for "QMDM – JULY 2020 – L2 – Q6 – Breakeven Analysis for Office Chairs"

QTB – MAY 2016 – L1 – SA – Q6 – Mathematics

Calculate break-even quantity given revenue and cost functions

You're reporting an error for "QTB – MAY 2016 – L1 – SA – Q6 – Mathematics"

QT – Nov 2017 – L1 – Q6b – Elements of Calculus

Calculate marginal cost, revenue, and profit for a company’s production of beverage cans.

You're reporting an error for "QT – Nov 2017 – L1 – Q6b – Elements of Calculus"

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