Question

Corny and Sweet grows and sells sweet corn at its roadside produce stand. The selling price per dozen is​ $4.00, variable costs are​ $2.00 per​ dozen, and total fixed costs are​ $1,200.00. What are breakeven sales in​ dollars?

Answer 1

Answer: the breakeven sales is $2,400.

Explanation:

Let the number of dozens of sweet sold = P

Other variables given include:

Total Fixed cost =$1, 200

Variable cost given =$2.00 of P

=$2P

Revenue(amount from sales) =

=$4. 00 of P

=$4P

Nt: Cost = fixed cost + variable cost

C = 1200 + 2P

Nt: breakeven occurs when Revenue equals Cost; R=C

Thus: 4P = 1200+2P

4P-2P=1200

2P = 1200. (divide sides by 2)

P= 600

To check for the break even sales =

4P = 1200 + 2P

Since P = 600

Thus: 4P = 4 × 600 = $2400

&

1200 + 2P = $1200 + $2(600)

= (1200+1200)$

= $2400

Thus, the break even price is $2,400.