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baherus [9]
3 years ago
11

The break-even quanity for a certain kitchen appliance is 6000 units. The selling price is $10 per unit, and the variable cost i

s $4 per unit. What must be the fixed cost to break even at 6000 units?
Business
1 answer:
Alinara [238K]3 years ago
3 0

Answer:

The correct answer is $36,000.

Explanation:

According to the scenario, the given data are as follows:

Break even quantity = 6000 units

Selling price = $10 / unit

So, Sales cost = 6,000 × $10 = $60,000

Variable cost = $4 / unit

So, total variable cost = 6,000 × $4 = $24,000

So, we can calculate the fixed cost by using following method:

Fixed cost = Sales cost - Variable cost

By putting the value,

Fixed cost = $60,000 - $24,000

= $36,000.

Hence, the fixed cost is $36,000.

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