Question

A business owner pays $1,200 per month in rent and a total of $120 per hour in employee salary for each hour the store is open. On average, the store brings in $200 in net sales per hour.
Which equation can be solved to determine the break-even point if x represents the number of hours per month the store is open?

Answer 1

The breakeven point is that in which the total cost is just equal to the total revenue. In other words, the profit becomes zero. The revenue and cost will be given below.

(1) Total revenue = ($200)x

(2) Total cost = ($120)(x) + 1200

Equating,
     200x = 120x + 1200

Solving for x gives us an answer of 3.33

Hence, the answer is 3.33.