Question

Sam screen prints custom t-shirts. He spends $320 each month for the paints he needs to make the shirts. He has found he can purchase quality plain shirts for $9.00 each. He screen prints the shirts and sells them at a local thrift shop for $24.00 each. The thrift shop charges him $100 per month to rent. How many shirts does Sam have to sell each month in order to break even?

Answer 1

Given parameters:

Cost of paint per month = $320

Cost of quality plain shirts  = $9 each

Selling price  = $24

Rent per month  = $100

Unknown:

Number of shirts Sam has to sell to break even  = ?

Solution :

 Let the number of shirt sold each month  = y

To break even the cost price per shirt must be equal to the selling price;

   i.e;

      Cost price  = selling price at break even point;

Cost price = Cost of paint + Cost of quality plain shirt + Cost of rent

                  = 320 + 9y + 100

                  = 420 + 9y

Selling price =  24y

To break even;

                      420 + 9y  = 24y

                      420  = j24y - 9y

                      420 = 15y

                          y  = $\frac{420}{15}$  = 28

To break even, Sam must sell 28 shirts in a month.