Question

The variable cost for a product is $1, and the total fixed cost are $300,222. The company sells

the products for $8 each. How many products will the company have to sell to break even?

Answer 1

42,889

Explanation:

The contribution margin of a product is $8 -1 = $7. Then the number that must be sold to cover fixed costs is ...

$300,222/$7 = 42,888.9

To break even, the company must sell 42,889 products.