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brilliants [131]
3 years ago
10

Pauley Company provides home health care. Pauley charges $35/hour for professional care. Variable costs are $21/hour and fixed c

osts are $78,000. Next year, Pauley expects to charge out 12,000 hours of home health care. What is the break-even point in sales dollars?
Business
1 answer:
DiKsa [7]3 years ago
6 0

Answer:

$195000.05

Explanation:

His fixed costs and variable costs must be made equal to his selling price in order to gauge the break even point in hours.

$78000 + $21x = $35x

78000 = 35x - 21x

78000 = 14x

x = 5571.428...

Rounded of : x = 5571.43 hours

break even point in terms of sales dollars :

5571.43 x 35 =  $195000.05

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As per the data given in the question,

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Jan.                       14,200                    13,053              (11,100 + 3,100 × 63%)

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May                       23,260                   21,688             (15,400 + 7,860 × 80%)

July                        12,400                   11,212              (10,200 + 2,200 × 46%)

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