Question

Data concerning Follick Corporation's single product appear below: Selling price per unit $ 270.00 Variable expense per unit $ 78.30 Fixed expense per month $ 155,490 The break-even in monthly dollar sales is closest to: (Round your intermediate calculations to 2 decimal places.) Multiple Choice
a. $155,490
b. $282,510
c. $219,000
d. $438,000

Answer 1

Answer:

Break-even point (dollars)= $219,000

Explanation:

Giving the following information:

Selling price per unit $270

Variable expense per unit $78.30

Fixed expense per month $ 155,490

To calculate the break-even point in dollars, we need to use the following formula:

Break-even point (dollars)= fixed costs/ contribution margin ratio

Break-even point (dollars)= 155,490/ [(270 - 78.3)/270]

Break-even point (dollars)= $219,000