Question

Lester Co. produces toy kites. It has a fixed cost of $62,150. If the selling price per unit is $9.50 and the variable cost per unit is $6.25, the breakeven point is:

Answer 1

The selling price per unit is a variable of 33.89$ cost per the breakeven point.

Answer 2

Lester Co. Produces 19124 units to make breakeven point.

Explanation:

Given:

Fixed cost = $62,150

Selling price per unit = $9.50

Variable cost per unit = $6.25

Production cost = 6.25x + 62,150

Revenue = 9.50 x, where "x" is the number of units.

To find the break even point, we need to equivate revenue and production cost.

9.50x = 6.25x + 62,150

Now we have to find the value of x.

9.50x - 6.25x = 62150

3.25x = 62150

Dividing both sides by 3.25, we get

x = 62150 ÷ 3.25

x = 19123.08

The number of toy kits cannot be in decimal.

So, x = 19124

Therefore, Lester Co. Produces 19124 units to make breakeven point.