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AURORKA [14]
4 years ago
7

Derst Inc. sells a particular textbook for $27. Variable expenses are $20 per book. At the current volume of 43,000 books sold p

er year the company is just breaking even. Given these data, the annual fixed expenses associated with the textbook total:
Business
2 answers:
RideAnS [48]4 years ago
7 0

Answer:

fixed cost = $301,000

Explanation:

Break even =fixed cost / contribution per unit

contribution= selling price - variable cost

contribution = 27 - 20 = $7

fixed costs = break even * contribution

                  = 43000*7 =301,000

irakobra [83]4 years ago
3 0

Answer:

The annual fixed expenses associated with the textbook is $301,000.

Explanation:

Selling Price = $27

Variable Cost = $20 per unit

Contribution margin = $27 - $20 = $7 per unit

Break-even = 43,000 units

Fixed Cost = ?

Use Break-even formula to calculate fixed cost

Break-even = Fixed cost / Contribution per unit

43,000 = Fixed cost / $7

Fixed Cost = 43,000 x $7

Fixed Cost = $301,000

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