Question

If a basket selling price is $13per unit with the variable expense is $10 per unit and the company's monthly fixed expense if $7,800, what is the break even point in sales

Answer 1

Answer:

26,000 units

Explanation:

The break-even point is calculated by dividing fixed costs by the contribution margin per unit.

Fixed costs are $78,000

Contribution margin per unit = selling costs - variable costs

=$13-$10

Contribution margin per unit=$3

Break-even point = $7800/$3

=26,000 units