Question

Kelly Company sells its only product for $250 per unit. It has variable costs of $90 per unit. Annual fixed operating costs amount to $19,200,000. Kelly's break-even point in units is:_______

Answer 1

Answer:

the break even point in units is 120,000 units

Explanation:

The computation of the break even point in units is shown belwo:

= Annual fixed operating cost ÷ (Selling price per unit - variable cost per unit)

= ($19,200,000) ÷ ($250 per unit - $90 per unit)

= $19,200,000 ÷ $160 per unit

= 120,000 units

hence, the break even point in units is 120,000 units

We simply applied the above formula so that the correct value could come

And, the same is to be considered