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Hitman42 [59]
4 years ago
12

The variable cost to produce a widget is $64, with fixed costs of $1,400. If you sell the widgets for $120 per piece, the break-

even point is
Business
1 answer:
kondaur [170]4 years ago
3 0

Answer:

The break even point is 25 units.

Explanation:

The break even point is where you have no gain, because the amount of sales in dollars is enoguh to cover your fixed costs. It is calculated

\frac{Fixed.costs}{Contribution.margin}

where the contribution margin (or CM) is the difference between price and variable cost. So, the CM in this case is 120 - 64 = 56.

Finally, the break even point is \frac{1,400}{56} = 25

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6 0
4 years ago
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