Question

Your overhead or fixed cost is $5,000 per month. Your average sale or service per unit is $75.00. You determined that the cost of goods sold is $35.00. Calculate breakeven point in units and in dollar sales for the year.

Answer 1

125

Step-by-step explanation:

freshbooks.com/hub/accounting/calculate-break-even-point

Break-Even point (units) = Fixed Costs ÷ (Sales price per unit – Variable costs per unit)

Break-Even point (units) = 5000 ÷ (75 – 35)

Break-Even point (units) = 5000÷40

Break-Even point (units) = 125

Answer 2

125 units

$9,375

Step-by-step explanation:

Your overhead or fixed cost is $5,000 per month. Your average sale or service per unit is $75.00. You determined that the cost of goods sold is $35.00. Calculate breakeven point in units and in dollar sales for the year.

BEP = fixed costs / sale price - COGS

BEP = $5,000 / (75 - 35)

BEP = $5,000 / 40

BEP = 125 units

BEP units in dollar sales:

= BEP units * sales price

125 * 75 = $9,375