Question

If the selling price per unit is $42, the unit contribution margin is $15, and total fixed expenses are $570,000, what will the breakeven sales in units be? Group of answer choices 13,571 38,000 8,550,000 21,111

Answer 1

Answer:

The break even in units is 38000 units

Explanation:

The break even in sales in units is the number of units that need to be sold to earn enough total revenue where it equals the total cost and there is no profit and no loss. The break even in units is calculated as follows,

Break even in units = Fixed costs / Contribution margin per unit

Where,

Contribution margin per unit = Selling price per unit - Variable cost per unit

Break even in units = 570000 / 15

Break even in units = 38000 units