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adoni [48]
4 years ago
9

Break-even analysis for a service company Sprint Nextel is one of the largest digital wireless service providers in the United S

tates. In a recent year, it had approximately 32.5 million direct subscribers (accounts) that generated revenue of $35,345 million. Costs and expenses for the year were as follows (in millions): Cost of revenue $20,841 Selling, general, and administrative expenses 9,765 Depreciation 2,239 Assume that 70% of the cost of revenue and 30% of the selling, general, and administrative expenses are variable to the number of direct subscribers (accounts). In part (a) and (b), round all interim calculations and final answers to one decimal place. a. What is Sprint Nextel's break-even number of accounts, using the data and assumptions given? million accounts b. How much revenue per account would be sufficient for Sprint Nextel to break even if the number of accounts remained constant? $ million per account
Business
1 answer:
Tema [17]4 years ago
8 0

Answer:

Explanation:

Variable cost = 20,841*70%+9,765*30% = 17,518.20

Fixed cost = 20,841+9,765+2,239   -17,518.20 = 15,326.8

Contribution margin per unit = (Revenue - Variable cost)/subscribers =(35,345-17,518.20)/32.5 = 548.5

a) Break even unit = Fixed cost/Contribution margin = 15,326.8/548.5 = 27.9 Million

b) Revenue per account = (Total variable cost+Total fixed cost)/subscribers = (17,518.20+15,326.8)/32.5 = $1010.61

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3 years ago
In addition to other factors, knowing how customers arrive at their _______ is critical to developing successful pricing strateg
slega [8]

Answer:

perceptions of value

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3 years ago
An organization-level diagnosis is appropriate when ________. a. groups are struggling with goal clarity b. task are being redes
Neko [114]

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The correct answer is letter "C": the desired effectiveness of the firm has not yet been obtained.

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3 0
3 years ago
At the end of April, Cavy Company had completed Jobs 766 and 765. The individual job cost sheets reveal the following informatio
baherus [9]

Answer:

                               Job 765        Job 766

Direct material         $5,670          $8,900

Direct labor              $3,500          $4,775

Overhead                 $5,400          $8,800

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3 years ago
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FrozenT [24]

Answer:

<u>Skills inventory</u>

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