Question

If the maximum operating capacity of the Rolling Creek Textile Mill is 25,000 yards of denim per month, determine the break-even volume as a percentage of capacity.

A) 20%
B) 40%
C) 60%
D) 80%

Answer 1

The break-even volume as a percentage of capacity is 100%.

Step-by-step explanation:

The break-even volume as a percentage of capacity can be determined by dividing the break-even volume by the maximum operating capacity and multiplying by 100.

In this case, the break-even volume is 25,000 yards of denim per month, and the maximum operating capacity is also 25,000 yards of denim per month. Dividing 25,000 by 25,000 and multiplying by 100 gives us 100%. Therefore, the break-even volume as a percentage of capacity is 100%.