Question

Sunland Company produces flash drives for computers, which it sells for $26 each. The variable cost to make each flash drive is $13. During April, 300 drives were sold. Fixed costs were $1400 for the month. How much is the monthly break-even level of sales in dollars for Sunland

Answer 1

Break-even point (dollars)= $2,800

Step-by-step explanation:

Giving the following information:

Selling price= $26 each

Unitary variable cost= $13

The fixed costs were $1400 for the month.

To calculate the break-even point in dollars, we need to use the following formula:

Break-even point (dollars)= fixed costs/ contribution margin ratio

Break-even point (dollars)= 1,400/ [(26 - 13)/26]

Break-even point (dollars)= $2,800