Planet company sells a product for $16 per unit, variable cost is $12 per unit, and the total fixed cost is $6,000. What is the break-even point in units?

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asked Aug 13, 2019 22.1k views

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Reto Meier · Answer 1 · 2019-08-19T11:49:14+0000

The following formula is used to calculate break even point:

Break even point = Fixed cost/(Price per unit - Variable cost per unit)

Substituting for the values given;

Break even point = 6,000/(16-12) = 1,500 units

Planet company sells a product for $16 per unit, variable cost is $12 per unit, and the total fixed cost is $6,000. What is the break-even point in units?

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