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Natali [406]
4 years ago
5

Arthur crafts miniature chocolate dollhouses which he sells for $23 each. Arthur has calculated the breakeven level of revenues

for his business at $1,460 of sales. The dollhouses have a variable cost of $8 to produce per unit.What are Arthur's fixed costs?
Business
1 answer:
vitfil [10]4 years ago
8 0

Answer:

Arthur's fixed costs are $952

Explanation:

The break-even point is the level of production at which the costs of production equal the revenues for a product and calculated by using following formula:

Break-even point in units = Fixed costs/(Selling price per unit-Variable cost per unit)

Fixed costs = Break-even point in units x (Selling price per unit-Variable cost per unit)

In Arthur, Break-even point in units = $1,460/$23

Fixed costs = $1,460/$23 x ($23 - $8) = $952

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Depreciation: Multiple Choice
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3 years ago
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