Question

The following information pertains to the Flying Fig​ Corporation: Total Units for information given 5,000 Fixed Cost per Unit $100 Selling Price per Unit $500 Variable Costs per Unit $125 Target Operating Income $250,000 What is the breakeven in sales​ dollars?

Answer 1

Answer:

Break-even point (dollars)= $1,000,000

Explanation:

Giving the following information:

Total Units for information given 5,000

Fixed Cost per Unit $100

Selling Price per Unit $500

Variable Costs per Unit $125

Target Operating Income $250,000

Break-even point (dollars)= (fixed costs+ profit)/ contribution margin ratio

Fixed costs= 5,000*100= 500,000

Break-even point (dollars)= (500,000 + 250,000)/ [(500 - 135)/500]= $1,000,000