Question

The Elmina Wilson Company produces spaghetti sauce that is used in restaurants. The fixed costs total $1,329,050. The selling price per 64 oz. Can of sauce is $12.40. The variable cost per can is $4.80. What is the break-even point in number of cans?

Answer 1

174879 units

Explanation:

Given that The Elmina Wilson Company produces spaghetti sauce.

Fixed costs =1,329,050 $

Selling price per 64 oz=
`12.40`

Variable cost per can =
`4.80`

Contribution = S-V=Selling price - var cost = 7.60 $

Break even poin in no of units = Fixed cost/Contribution per unit

=
`(1,39,050)/(7.60) \\=174878.94\\=174879`