Question

Use the following information to determine the break-even point in units (rounded to the nearest whole unit): Unit sales41,000 Units Unit selling price$15.45 Unit variable cost$9.40 Fixed costs$177,000

Answer 1

Answer:

29,257 units

Explanation:

The break-even point is reached when the revenue from sales equals total variable plus fixed costs.

The break-even point, in units is:

$x*\ 15.45 = \ 177,000+(x*\ 9.40)\\x=\frac{\ 177,000}{\ 15.45-\ 9.40} \\x=29,256.20$

Rounding up to the nearest whole unit, the break-even point is 29,257 units.