Question

The total fixed costs of producing a product is $36,000 and the variable cost is $124 per item. If the company believes they can sell 1,800 items at $170 each, what is thebreak-even point?667 items695 items705 items783 itemsNone of these choices are correct.

Answer 1

`\begin{gathered} PRODUCING\text{ COST=\$36,000} \\ \text{VARIABLE COST= \$124} \\ 1,800\text{ items} \\ 170\text{ each item} \\ \text{brake}-\text{even point =}\frac{PRODUCING\text{ COST}}{SELLING\text{ PRICE-VARIABLE COST}} \\ \\ \text{brake}-\text{even point =}\frac{36,000}{170\text{-1}24} \\ \\ \text{brake}-\text{even point =}783 \\ The\text{ brake}-\text{even point is 783 items} \\ \\ \end{gathered}`