Outback outfitters sells recreational equipment. one of the company’s products, a small camp stove, sells for $50 per unit. variable expenses are $32 per stove, and fixed expenses associated with the stove total $108,000 per month. required: 1. what is the break-even point in unit sales and in dollar sales? 2. if the variable expenses per stove increase as a percentage of the selling price, will it result in a higher or a lower break-even point? (assume that the fixed expenses remain unchanged.) 3. at present, the company is selling 8,000 stoves per month. the sales manager is convinced that a 10% reduction in the selling price would result in a 25% increase in monthly sales of stoves. prepare two contribution format income statements, one under present operating conditions, and one as operations would appear after the proposed changes. 4. refer to the data in (3) above. how many stoves would have to be sold at the new selling price to attain a target profit of $35,000 per month?

Kandon enterprises, inc., has two operating divisions; one manufactures machinery and the other breeds and sells horses. both divisions are considered separate components as defined by generally accepted accounting principles. the horse division has been unprofitable, and on november 15, 2018, kandon adopted a formal plan to sell the division. the sale was completed on april 30, 2019. at december 31, 2018, the component was considered held for sale. on december 31, 2018, the company’s fiscal year-end, the book value of the assets of the horse division was $415,000. on that date, the fair value of the assets, less costs to sell, was $350,000. the before-tax loss from operations of the division for the year was $290,000. the company’s effective tax rate is 40%. the after-tax income from continuing operations for 2018 was $550,000. required: 1. prepare a partial income statement for 2018 beginning with income from continuing operations. ignore eps disclosures. 2. prepare a partial income statement for 2018 beginning with income from continuing operations. assuming that the estimated net fair value of the horse division’s assets was $700,000, instead of $350,000. ignore eps disclosures.