RST Company produces a product that has a variable cost of $6 per unit. The company's fixed costs are $30,000. The product sells

Question

3 years ago

10

for $10 per unit. The break-even point in sales dollars is $_____________.

1 answer:

Anni [7] · Answer 1 · 2022-03-29T07:54:57+03:00

Answer: $75000

Explanation:

In order to solve the question, firstly we need to calculate the contribution margin ratio which will be:

= ($10 - $6) / $10

= 40%

Then, the break even sales will then be:

= Fixed cost / Contribution margin ratio

= $30000 / 40%

= $75000

Therefore, the break-even point in sales dollars is $75000