Question

Partner Industries sells a single product for $45 that has a variable cost of $25. Fixed costs amount to $10 per unit when anticipated sales targets are met. If the company sells one unit in excess of its break-even volume, profit will be:_________

Answer 1

Profit of One unit in excess of break even point = $20

Explanation:

Break even point is where Sales =Total cost

Normal profit per unit $45--25$-$10 = $10

Profit of Units in Excess of Break Even Volume

Sales Price -Variable Cost

= $45- $25 = $20